What's a "High Deductible Health Plan"?

There is one other type of health plan description that has nothing to do with network design, but a lot to do with cost:

HDHP with an HSA (High-Deductible Health Plan with a Health Savings Account):

1. How it works: Did you survive that crazy acronym? Then you're halfway there! This one is actually a fairly simple concept. You can only have this type of plan if you choose an HMO or PPO with a high deductible. Once you pay your deductible, your plan will cover 100% of your care. You should plan to set aside some money in a savings account, ideally a special type of savings account called a Health Savings Account (HSA), to pay your deductible. All of your HSA spending is tax-deductible (meaning you won't pay taxes on the money you put in an HSA, also known as "pre-tax contributions") so it can be a powerful financial tool.

2. What you pay: Your coinsurance and copays will all depend on your plan, but you are guaranteed a very low premium and high deductible.

3. Is a high-deductible plan with an HSA right for you? If you are relatively healthy and know you will take advantage of a tax-deductible HSA, this could be a great option for financial independence. But if you need a lot of health care or can't afford the high deductible, HDHP might not be the best plan for you.