With health insurance costs continually on the rise, many individuals and families are looking for innovative solutions to provide quality medical protection at an affordable price. The consumer-driven plan approach is an effective way to keep quality medical protection and significantly lower your premium.

Consumer Driven Plan Definition

A consumer driven plan consists of two parts; a major medical health insurance plan, and a tax advantaged savings account.  The most popular consumer driven plan combination is using a qualified high deductible health plan with a health savings account (HSA).  This is because it allows for the lowest premium with the best tax advantages.

Quality Medical Protection

Qualified high deductible health plans offer great major medical protection at a very fair price.  Typically these plans have deductibles ranging from $1,500 to $5,000 per individual and $3,000 to $10,000 per family.  It's possible to find plans that will cover 100% of your medical expenses after your deductible.  Many plans cover 70% or 80% after the deductible, making your premium even lower.  Of course most plans have a stop loss, or a maximum total dollar amount that you would pay in one year if you had major medical expenses.  Many of these plans also pay for one preventive care visit (physical) per person for year.

Significant Tax Savings

Once you have your qualified high deductible health plan in place, you are eligible to open a health savings account (HSA).  You can open an HSA at your local bank or credit union.  It's basically a checking account that often comes with a debit card.  Once open, you can deposit money into your HSA and save up for unexpected future medical expenses.  When you make deposits, they become tax deductible contributions.  Then, when you have medical expenses, you can pay for them out of your HSA, tax free.

A consumer-driven plan offers a great medical and financial solution for individuals, families, and the self-employed.  It's an excellent way to save hundreds, if not thousands, of dollars per year and still have quality major medical protection.