Should i get hdhp

Are you likely to require medical care above and beyond preventive? If so, an HDHP plan with a lower monthly premium may not necessarily be an advantage—a more traditional plan with a higher premium and lower deductible might offer you improved cost savings.

For example, immunizations for travel are generally not covered. See your plan documents for a complete list of covered preventive care services. A few states do not allow pretax treatment of contributions or earnings.

Contact a tax professional for details. All insurance policies and group benefit plans contain exclusions and limitations. For availability, costs and complete details of coverage, contact a licensed agent or Cigna sales representative.

This website is not intended for residents of New Mexico. Selecting these links will take you away from Cigna. Cigna may not control the content or links of non-Cigna websites. For the best experience on Cigna. On top of that, the annual maximum out-of-pocket expenses copays and coinsurance can be quite high.

What would happen if you or someone on your plan needs extensive coverage next year and your out-of-pocket expenses will reach the limit? There is some good news. Money in an HSA can be used tax free at any time to pay qualified medical costs. If your employer chips in money to help you meet your out-of-pocket expenses that can be a big help, but compare that help to what your total out of pocket expenses might be.

Most HSAs are funded with worker contributions. Surveys show that people with HDHPs are more prone to have medical debt. Or even worse, is that people with HDHPs tend to delay seeking medical care, because they know they will go into debt to cover the deductible. I know some of you with workplace health insurance have no choice: a HDHP is all you are offered.

In that case, I want you to follow the same advice for people who are considering an HDHP offered through their state health insurance exchange. The main message I have for you is to make it a top priority to set aside money so you know you can pay for the deductible and any out of pocket costs. Money you contribute reduces your taxable income. The money grows tax-free while it is your account.

You can leave the money growing year to year and when you leave a job, the HSA account is yours to take with you. When you withdraw money from an HSA to pay a qualified medical expense there will be no tax on the withdrawal.

If an HSA is not in the picture, your job is to double-down on building your own emergency savings fund. And you also have to itemize to get that deduction, and itemizing is no longer the best option for most filers now that the Tax Cuts and Jobs Act increased the standard deduction so much. This is because people with modest health care needs might not end up meeting their out-of-pocket maximum.

The lower deductible means that their insurance plan will start to pay sooner, and the plan might cover a variety of services — like office visits, urgent care visits, and prescriptions — with copays instead of having the patient pay for them with the costs counting towards the deductible.

You can deduct your HSA contributions when you file your tax return, without having to itemize your deductions. An HSA is a good solution for making sure you have the funds available to cover your deductible if necessary. If and when you need to meet your deductible, the money is there for you to use. Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.

Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts. We do not sell insurance products, but this form will connect you with partners of healthinsurance. You may submit your information through this form, or call to speak directly with licensed enrollers who will provide advice specific to your situation. Read about your data and privacy. The mission of healthinsurance. Learn more about us.