What is the main difference between an HDHP and an LDHP?

The primary difference is the deductible. A high deductible health plan (HDHP) requires you to pay more out of pocket before your insurance begins covering costs, while a low deductible health plan (LDHP) has a lower deductible but typically comes with higher monthly premiums.

Is a high deductible health plan better than a low deductible health plan?

It depends on the individual consumer’s needs. An HDHP may be a good choice for healthy individuals who don't expect many medical expenses and want lower premiums. An LDHP is often better for people who need frequent medical care and prefer lower out-of-pocket costs when they receive treatment.

Can you have a health savings account (HSA) with a low deductible health plan?

No. To contribute to an HSA, you must enroll in an HSA-qualified HDHP. Most low deductible health plans aren't eligible for HSA contributions.

Can employers offer both HDHP and LDHP options to employees?

Yes. Employers can offer multiple plan options through a traditional group health insurance program. Alternatively, employers can provide a QSEHRA or ICHRA, which allows employees to choose the individual health plan, including an HDHP or LDHP, that best fits their medical needs.

How can employers help employees with out-of-pocket healthcare costs?

Employers can supplement health coverage with benefits such as health savings accounts (HSAs), group coverage HRAs (GCHRAs), qualified small employer HRAs (QSEHRAs), or individual coverage HRAs (ICHRAs). These benefits can help employees pay for out-of-pocket medical expenses on a tax-free basis to make healthcare more affordable.

What is the most valued employee benefit?

Health insurance is consistently ranked as the most valued employee benefit. According to PeopleKeep's employee benefits survey, employees ranked health insurance as the most important valued benefit, followed by dental insurance, paid leave, retirement plans, and vision insurance.

Are employee benefits taxable?

Some employee benefits are taxable, while others are tax-free. For example, cash bonuses are generally taxable income, while certain health benefits, employer-sponsored health insurance premiums, and qualified retirement contributions may receive favorable tax treatment. Tax rules vary by benefit type, so employers should consult a tax professional or benefits advisor for guidance.

Do I legally have to offer health insurance?

Not all employers must offer health insurance. Under the Affordable Care Act (ACA), only applicable large employers (ALEs) with 50 or more full-time equivalent employees must offer affordable health coverage that meets minimum essential coverage requirements. Smaller employers can choose whether to offer health benefits but often do so to remain competitive in hiring and retention.

Why are employee benefits important?

Employee benefits help employers recruit and retain workers, improve employee satisfaction, and strengthen workplace culture. Many employees consider benefits just as important as salary when evaluating job opportunities. A competitive benefits package can also show that an employer values their employees’ well-being and work-life balance.

What benefits should a small business offer employees?

The right benefits package depends on your workforce and budget. However, many small businesses start with health benefits, like a health reimbursement arrangement (HRA), paid time off, retirement savings options, and flexible work arrangements.

Can medical bills affect my credit score in 2026?

Yes, but only if they go unpaid for more than one year and the balance is more than $500. Paid medical bills and bills less than $500 are excluded by the major credit bureaus.

How do I find a hospital’s charity care limit?

Search your hospital’s website for “501(r) Financial Assistance Policy” or something similar. You can also call your provider’s billing department. Your state may also have a record of hospital policies.

What is a good faith estimate?

If you schedule a medical procedure at least three days in advance, the provider must give you a written good faith estimate. According to CMS, if the procedure is within three to nine business days, you can get the estimate within one business day. If it’s 10 or more business days out, you should get an estimate within three business days. You should ask your provider for an estimate before seeking care if they haven’t provided one. You’ll need this GFE to dispute your medical bills.

Can I use my QSEHRA or ICHRA to pay a medical debt from a previous year?

No. IRS rules require that the medical expense be incurred during the current plan and while you’re a participant. You can’t use current year HRA contributions to pay a previous year’s bills. However, you can use your HRA contribution toward a current-year procedure if your employer allows reimbursement for out-of-pocket medical expenses. Additionally, you generally have up to 90 days to request reimbursement for expenses incurred during the previous year with any remaining HRA balances. This is known as a runout period.

Elizabeth Walker

Elizabeth Walker is a content marketing specialist at Remodel Health and PeopleKeep. Since starting with the company in April 2021, she has become well-versed in writing about HRAs, health benefits, and small business solutions. Outside of her expertise in the healthcare benefits industry, Elizabeth has been a writer for more than 20 years and has written several poems and short stories. She's published two children’s books in 2019 and 2021, which she is developing into a series of collected works. Her educational background as a classical musician and love of the arts continue to inspire her writing and strengthen her ability to be creative.

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