Why is an HDHP up to $3,000 less expensive?
Two reasons: (1) Lower Administration Costs-The first $2,500 per year of a family’s medical care is typically spent in $100 increments in 25 transactions, potentially costing the insurance company $30 or more to process the paperwork for each transaction ($2,500 medical cost + $750 processing costs = $3,350); and (2) Health Applicant Pool-Only healthy people without preexisting medical conditions qualify for HDHP-insurance companies generally reject about 1/3 of Individual (or Family) HDHP applicants because they (or someone in their family) have a preexisting medical condition.
