High-Deductible Health Plans

Healthcare is changing fast, and there are new ways for you to benefit. A WageWorks® Health Savings Account (HSA), combined with your company’s qualified high-deductible health plan (HDHP), gives you an easy, safe way to pay less for healthcare costs today while saving money for future healthcare expenses.

An HDHP changes how you typically pay for the health insurance, as compared to a traditional health insurance plan like a Preferred Provider Organization (PPO) plan. But the term “high-deductible health plan” may be a bit misleading. A better name for this type of health insurance plan would be a “low-premium health plan.”

While HDHPs have higher annual deductibles than traditional insurance plans, they offer tremendous savings, such as:

  • Generally lower monthly premiums than traditional health insurance plans
  • Preventative care services with no participant cost-sharing
  • A limit on the total out-of-pocket payment you are required to pay, including deductibles, covered medical expenses, copayments, and coinsurance

Another reason why a qualified HDHP is a great deal is because it’s the only type of health insurance plan that allows you to maximize your savings with an HSA.

Ask your employer if you have the option of enrolling in a qualified HDHP. If so, the combination of a qualified HDHP and an HSA provides you with enormous savings power. This calculator can help you determine how much you can save when you choose a qualified HDHP and enroll in an HSA. 

Lower Your Monthly Health Insurance Premiums

Qualified HDHPs typically cost less than traditional PPOs—so much less that even if you consume a relatively high amount of healthcare services, you can still save. Instead of paying high premiums to cover costs that may never be incurred, you can put that same money aside in your HSA to save and use for your actual healthcare expenses until you meet your deductible, regardless of whether you change health insurance plans, retire, or leave your company.

And if you have a year with minimal healthcare expenses, you save both the premium costs as well as any money you did not pay toward your deductible. This means you may have more money saved for any future healthcare needs.

Cut Your Tax Bill

Just like a 401(k), your HSA contributions aren’t taxed. Unlike a 401(k), you can use as much of your HSA as needed to pay for qualified medical expenses.*

*HSAs are not subject to federal income tax when used appropriately for qualified medical expenses. You should consult a tax advisor regarding your state’s tax code.

Build Your Healthcare Nest Egg

A WageWorks HSA offers competitive interest rates, low fees, and attractive investment options to grow your healthcare nest egg according to your own needs and risk tolerance. Your interest and investment income earned on HSA balances is also tax-free,* allowing you to build a bigger nest egg even faster. And you take your nest egg with you wherever your career takes you.

*HSAs are not subject to federal income tax when used appropriately for qualified medical expenses. You should consult a tax advisor regarding your state’s tax code.

Use the Same Doctors

A qualified HDHP often uses the same healthcare networks as traditional plans. And whether you stay in network or use an out-of-network provider, you can pay for any fees for which you’re responsible with your HSA funds.