Florida High Deductible Health Plan

What is a High Deductible Health Plan?

Traditional health insurance, whether provided through an employer or bought individually, has high monthly premiums and lower deductibles. This is fine if you can afford the premiums or if visit a doctor regularly. But what if you can’t afford to pay a high monthly premium or would like to save some money?

This is where high deductible plans come in. They allow you to have coverage for major medical expenses—such as a trip to the hospital—while paying less per month. The addition of the HSA or HRA accounts allows you to actually save, tax-free, for a time in the future when you have a medical expense.

How does the Health Savings Account work?

A Health Savings Account works very much like a personal checking or savings account. You and your employer can designate a portion of your salary to be contributed to your account—tax free. You can then use the money in your account to cover eligible expenses before you reach your deductible.

There are several benefits unique to Health Savings Account that differentiates them from Flexible Spending Accounts. The benefits include:

• Withdraw tax-free for eligible expenses. You don’t have to predict ahead of time how much you will need to spend. Only make a withdrawal when you have medical expenses.

• Take it with you. Your account belongs to you and isn’t tied to your employer. If you change jobs, the money in your account remains and you can take it with you.

• Save for the long-term. If you have money in your account after you turn 65, you can withdraw it tax-free for any reason without incurring penalties.

Benefits of having a High Deducible Health Plan

There are several reasons to consider a high deductible plan:

• Lower your monthly expenses. Your monthly premium will be lower than a traditional plan.

• Eligible for an HSA. To take have a Health Savings Account, you typically will have to first purchase a High Deductible plan.

• Take control of your expenses. Since you will be the one paying for your own medical expenses, you will have greater control over how the money is spent.

• Government employees welcome. Recently government employees have become eligible for high deductible plans.

Drawbacks of High Deductible Plans

Like most things in life, there are some drawbacks that you need to be aware of. The drawbacks of Florida high deductible health plans include:

• Penalties for withdrawing before age 65. If you need to withdraw money from your account before age 65, the money will be counted as income and subject to an additional ten-percent tax.

• High deductibles. High deductibles save you money—until you have a major medical expense. The minimum deductible is $1,100 for individuals and $2,200 for families. If you end up reaching that deductible every year, you may be better off paying a higher premium to get a lower deductible.

Other High Deductible Plan Concerns

High deductible plans have been available for several years now, but they haven't become really popular yet. Some of this is due to lack of education about the plans, and sometimes even poor administration on the part of companies that offer HSAs.

One concern in particular is that high deductible plans may not lower costs overall. For an individual whose needs are met by these plans, it can cost less. But employers still have to contribute large amounts into the HSA for them to be worthwhile, for example.

Another concern for the health care industry is that with such high deductibles, patients may not seek care in the early stages of an illness or injury in order to avoid paying for an office visit. This can cause the problem to worsen, resulting in much higher costs once the patient receives treatment--for both the patient and the medical facility.

Florida Health Care

A recent Orlando Sentinel article reports that health care rates in Florida rose by 6.1 percent. While this is actually slower growth than in year's past, it is still considerable growth. Many small businesses, in particular, are feeling the effects of high premiums. They are unable to offer health insurance plans because it's just too expensive.

Many of Florida's children are without health insurance as well. Nearly nineteen percent of children are without health insurance in Florida.

High deductible plans will certainly not solve all of the problems in Florida. But, the affordability of these plans can certainly help. Whether a small business chooses high deductible plans for employees, or a family opts to have some coverage for their children, a high deductible plan is far better than no coverage at all.

Florida High Deductible Health Plans Quotes

There are many companies in Florida that offer high deductible plans. Many of them will give you a quote online.

• Aetna. They offer two high deductible plans for Florida residents, along with a moderate deductible plan that is also HSA compatible.

• Celtic. This company offers several high deductible plans with varying deductible options. For more details there is also a benefit chart.

• Blue Cross of Florida. Visit the Blue Cross website to learn more about their HSA plans that provide high deductibles.