In a high deductible health plan, premiums are typically

• A. Higher
• B. Lower
• C. Same
• D. Varies

Answer: (B)

High deductible health plans have lower monthly premiums because you take on more of the upfront cost. The insurer offers a cheaper monthly payment since the plan’s design shifts most of the initial medical costs to you until you meet a high deductible. Once you reach that deductible, the plan covers expenses (often with coinsurance or other cost-sharing) for services, but the trade-off is paying more out of pocket before coverage starts. This lower premium is often paired with an HSA, allowing you to save pre-tax money for future medical expenses. So, the typical pattern is a lower premium in an HDHP, with higher potential costs before you reach the deductible.