health insurance premiums and higher deductibles

I am a huge proponent of HSAs and high deductible plans. They might single-handedly save health care in America.

But when you are getting a high-deductible plan, it pays to get the highest deductible you can get. Here’s the facts:

If you want to get a high-deductible plan in California and you are 30-34, you have two choices with Blue Shield — a $2400 deductible and a $4000 deductible. A $1600 difference (all the other items on the plan are the same). You’d think that the yearly premium would be fairly similar with the 2400 being a bit more expenses – maybe about $200 more. But here is where it gets crazy.

The 2400 dues is $114/mo or $1368/yr

The 4000 dues is $63/mo or $756/yr.

So that means the 2400 Plan is $612 dollars more expensive than the 4000 Plan even though you only get a maximum of $1600 in additional coverage. That is a HUGE premium for that insurance.

So if you are healthy, plan on being relatively healthy the next year, and are financially stable, you’d think it was in your obvious best interest to get the highest deductible possible.

(by the way, this analysis is even more true for car insurance and other types of insurance).

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