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High Deductible Health Plans (HDHPs) are characterized by their structure of lower premiums compared to other types of health plans, while simultaneously requiring higher out-of-pocket costs when accessing healthcare services. This design is intentional, aimed at making healthcare coverage more affordable in terms of monthly payments, but it places a greater financial burden on individuals when they need medical care, due to the higher deductible amounts.

These plans typically feature deductibles that must be met before insurance begins to cover a significant portion of healthcare expenses. Therefore, while someone enrolled in an HDHP may benefit from lower monthly costs, they should be prepared to pay more out of pocket before receiving assistance from their insurance provider. This approach can be advantageous for those who are relatively healthy and do not anticipate needing frequent medical services, as they can save on premium costs while potentially leveraging Health Savings Accounts (HSAs) for tax-advantaged savings.

In contrast, other types of plans like PPOs, low deductible health plans, and HMOs often come with higher premiums but lower deductibles and out-of-pocket costs, making healthcare expenses more predictable when care is accessed.