High-deductible health insurance is becoming more common in the US and it is good for the young population, reports Huffington Post.
A high-deductible health plan (HDHP) in the US is a health insurance plan with lower premiums and higher deductibles than a traditional health plan. Being covered by an HDHP is also a requirement for opening a health savings account.
The report based on a survey carried out by the Employee Benefit Research Institute last December, says that the numbers of insured Americans with high-deductible health coverage has more than doubled since 2005.
Employers opt for high-deductible health insurance for the simple reason that it saves cost and the trend is likely to continue as high-deductible health insurance plans will be eligible to be sold starting in 2014 on the insurance 'exchanges'.
These plans are popular, especially among younger and healthier people because they don't have to go to the doctor frequently, and because the plans have lower monthly premiums.
Also, they provide coverage against catastrophic medical expenses.
Another advantage that the plan offers is, individuals and their employers can put money into tax-free health savings accounts that accumulate over time. It's a great deal for high-income earners who have the cash to spare and can maximize tax benefits.
However, coverage for preventive services like flu shots and cholesterol screenings often isn't subject to deductible health insurance.