You are using a browser we no longer support. Current functionality may be reduced and some features may not work properly. For a more optimal experience, please click here for a list of supported browsers.

Have you ever considered a High Deductible Health Plan? – Part 1 of 4

Scott Horstman, Product Development Manager | August 23, 2018

Learn more about the advantages of an HDHP.

For many people, choosing a High Deductible Health Plan (HDHP) can be a daunting and confusing decision. Just the name itself — High Deductible Health Plan – gives an initial impression that the out-of-pocket amount is prohibitive. In this four-part series, I'm going to help show you the advantages of an HDHP.

A growing number of individuals are choosing HDHPs. Those who do are discovering that their benefits extend beyond personal well-being and include financial well-being. Whether due to lack of familiarity or uncertainty as to how they work, overlooking an HDHP, especially when it includes plan provider contributions to a health savings account (HSA), often results in a missed opportunity.

An HSA is a tax-advantaged medical savings account that works in conjunction with an HDHP. Many Federal Employees Health Benefits (FEHB) plan providers will "pass through" a portion of the premium and contribute that to the participant's HSA. This contribution, in many cases, is the equivalent of reducing the participant's deductible by as much as 50%. Also, like any other FEHB plan, HDHPs cover all preventive care at no cost to the member.

An HDHP is a way to get low-cost health care coverage and start building a savings toward future medical expenses. In many instances, money in an HSA can be invested and grow tax free. If you don't use the money in your HSA, don't worry. Those dollars are yours to keep. Even if you leave federal employment.

Information shared in this article should not be taken as legal or tax advice as HDHPs may not be the best choice for everyone. To help you determine if an HDHP is right for you, consult with a trusted tax or legal adviser and review IRS publications 502 and 969.

Learn more about GEHA's HDHP