A High Deductible Health Plan (HDHP) usually has a much higher deductible than a traditional insurance plan.
Usually the monthly premium is lower, but you have to pay more health care costs yourself (your deductible) before the insurance company starts to pay its share.
♦ A high deductible plan can be combined with a health savings account or a health reimbursement arrangement. This allows you to pay for certain medical expenses with untaxed dollars.
For 2021, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family.
• In 2021, an HDHP’s total yearly out-of-pocket expenses (including deductibles, copayments, and coinsurance) cannot be more than $7,000 for an individual or $14,000 for a family.
→ For 2022, the IRS continues to define a HDHP as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family.
In 2022, yearly out-of-pocket expenses cannot be more than $7,050 for an individual or $14,100 for a family.
• This limit doesn’t apply to out-of-network services.