Which statement best describes the relationship between deductibles and premiums in an HDHP?

Prepare for the Business of Healthcare and Health Policy Test. Study with multiple choice questions and explanations to ace your exam!

The relationship is that higher deductibles come with lower premiums. In a high-deductible health plan, you agree to pay more out-of-pocket before any insurance coverage kicks in, and because the insurer takes on less predictable, smaller-value costs, the monthly price you pay for the plan (the premium) is reduced. This design makes HDHPs attractive for people who are healthy or who can cover a larger upfront amount if they need care, and it often goes hand in hand with eligibility for a Health Savings Account. The opposite—higher premiums with higher deductibles—or no relationship at all, doesn’t fit how insurance pricing works, and premiums aren’t fixed regardless of deductible.