An HDHP is primarily defined by its relation between deductible and premiums.

• A. High deductible, lower monthly premiums.
• B. High deductible, higher monthly premiums.
• C. Low deductible with low premiums.
• D. No deductible, full coverage from day one.

Answer: (A)

High-deductible health plans are defined by a large deductible paired with lower monthly premiums. This design shifts more upfront cost to the insured while keeping ongoing monthly payments affordable, which is why the premium is lower even though you face a higher deductible. Many HDHPs are paired with a Health Savings Account, allowing you to save pre-tax dollars to cover medical expenses and tax-advantaged growth for future costs. After you meet the deductible, coverage typically begins to pay, subject to the plan’s coinsurance and out-of-pocket maximum.

So, describing an HDHP as having a high deductible with lower monthly premiums best captures its defining cost structure. Plans with low or no deductible, or with high premiums for a high deductible, reflect different plan designs and don’t fit the HDHP model.