Which of the following describes a high-deductible health plan?

• A. Low deductible with high monthly premium
• B. No deductible and no coinsurance
• C. High deductible with low monthly premium
• D. Deductible applies to every service without any cap

Answer: (C)

A high-deductible health plan is defined by paying more out-of-pocket before coverage kicks in, while keeping monthly premiums lower. This setup means you shoulder a larger deductible before the insurer pays for most services, often paired with the ability to save pre-tax in an HSA. After meeting the deductible, you may pay coinsurance until you reach the annual out-of-pocket maximum, at which point the plan pays 100% of covered expenses. The best description here is high deductible with low monthly premium. The other descriptions don’t fit because a HDHP isn’t characterized by a low deductible with high premium, nor by having no deductible or no coinsurance, and it does include an annual out-of-pocket cap rather than an unlimited deductible for every service.