HDHP vs PPO break-even calculator

What's the real tradeoff between an HDHP and a PPO?

A high-deductible health plan (HDHP) charges a lower monthly premium and makes up for it with a higher deductible, the amount you pay out of pocket before the plan starts sharing costs. A PPO (preferred provider organization) plan flips that: a higher premium every month, but a lower deductible and less exposure if you get sick. Neither structure is automatically better. The HDHP is a bet that you'll spend less on care than the premium difference, plus whatever the HSA (health savings account) tax break is worth to you. The PPO is a bet that your care costs will be high enough, or certain enough, that paying more every month to cap your risk earlier is worth it.

The only way to know which bet is right for your situation is to run your own numbers, which is what the calculator below does.

Why does the HSA tip the math toward the HDHP?

An HDHP is only worth comparing against a PPO once you count the health savings account (HSA) that comes with it, because the HSA is where most of an HDHP's real advantage lives. Two things stack on top of the lower premium:

• Employer money. Many employers seed part or all of an employee's HSA to help offset the higher deductible. That money is yours, not a rebate that disappears if you don't spend it.
• The triple tax advantage. Money you contribute to an HSA goes in pre-tax, grows tax-free, and comes out tax-free for qualified medical costs. No other account gives you all three. In 2026 the IRS caps total contributions (yours plus your employer's) at $4,400 for self-only coverage and $8,750 for family coverage, with a $1,000 catch-up if you're 55 or older.

Together, the employer contribution and the tax deduction lower an HDHP's true cost below its sticker price. See is a high-deductible health plan worth it for the full 2026 HDHP and HSA eligibility rules, and HSA contribution limits for 2026 for the complete table of caps and catch-up amounts.

Calculate your HDHP vs PPO break-even

The calculator starts filled in with the sample numbers from the answer above. Change any field to see your own plans, your own totals, and your own break-even spending level.

2026 HSA contribution cap ($4,400 self-only): IRS Revenue Procedure 2025-19. All premium, deductible, coinsurance, and spending figures in this calculator are numbers you enter; they are illustrative math, not a quote from any insurer, and not tax advice.

When does the HDHP win?

The HDHP tends to win when your medical spending is low or hard to predict in advance, which describes most healthy adults in most years. You bank the lower premium every month, and if you don't get sick, you keep the full difference plus the employer's HSA contribution plus the tax deduction on anything you put in yourself. Even in a moderate spending year, the combination of a lower premium and the HSA's tax break often keeps the HDHP ahead, which is exactly what the sample numbers above show at $4,000 in spending.

When does the PPO win?

The PPO tends to win once your spending is both high and fairly certain, such as an ongoing prescription, a planned surgery, a pregnancy, or a chronic condition with predictable annual costs. Above the break-even point, you are spending enough that the HDHP's dollar-for-dollar exposure outpaces what the lower premium and the HSA tax break can offset, and the PPO's earlier, gentler cost-sharing starts to cost less overall.

Take the sample numbers again, but push spending to $20,000, the kind of year a major surgery or a NICU stay could produce. The HDHP has already hit its $6,500 out-of-pocket max by then, so its total cost stops climbing: premium plus max out-of-pocket, minus the employer contribution and the tax savings on a maxed-out HSA contribution, comes to about $9,342 for the year. The PPO has also hit its own, lower $2,500 out-of-pocket max, so its total stops at $9,100. At this spending level the PPO wins, by about $242, because its out-of-pocket max is lower than the HDHP's even though its premium is higher. That gap is the whole reason a PPO exists: it buys you a lower ceiling.

How is each plan's out-of-pocket cost calculated here?

The PPO side uses the standard structure: you pay the full deductible first, then a flat coinsurance percentage of every additional dollar, until your total out-of-pocket hits the PPO's own out-of-pocket max, after which the plan covers the rest.

The HDHP side is simplified on purpose: this calculator treats every dollar you spend, up to the HDHP's out-of-pocket max, as coming straight from your pocket. Real HDHPs vary here. Some pay 100% the moment you clear the deductible, which makes the deductible the effective ceiling. Others coinsure a portion of the bill between the deductible and the max, the same way a PPO does, which would lower your real out-of-pocket cost somewhat below what this tool shows. The deductible field is still useful on its own: it's shown so you can check your plan actually qualifies as an HDHP under the 2026 IRS floor ($1,700 self-only), and the calculator will flag it if your numbers fall outside the 2026 HDHP range.

On the tax side, the calculator assumes you route enough of your own money through the HSA to cover whatever out-of-pocket cost your employer's contribution doesn't already handle, up to the 2026 IRS contribution cap, and that you take the pre-tax deduction on that amount. That's the rational way to use an HSA if you're going to spend the money on care anyway, so it's the assumption built into "your own HSA contribution" and "HSA tax savings" in the table.

Worked example: reading the default numbers

Here's the $4,000-spending example from the top of the page, broken into steps.

1. HDHP out-of-pocket. $4,000 in spending is below the $6,500 out-of-pocket max, so the full $4,000 comes out of pocket in this simplified model.
2. Your HSA contribution. The employer already put in $500, so you'd need $3,500 of your own money in the HSA to cover the rest of that $4,000 ($4,000 minus $500). That's under the 2026 self-only cap of $4,400 (after the employer's $500, you have $3,900 of room left), so the full $3,500 fits and gets the tax break.
3. Tax savings. At a 22% marginal rate, deducting $3,500 saves about $770.
4. HDHP total. $4,200 in premium, plus $4,000 out-of-pocket, minus the $500 employer contribution, minus $770 in tax savings, comes to $6,930.
5. PPO out-of-pocket. $500 deductible, then 20% coinsurance on the next $3,500 of spending ($700), for $1,200 total, well under its $2,500 out-of-pocket max.
6. PPO total. $6,600 in premium plus $1,200 out-of-pocket comes to $7,800.

The HDHP wins by $870 at this spending level. The break-even, where the two totals would tie, works out to about $5,198: past that point, the PPO's lower out-of-pocket max starts to outweigh the HDHP's lower premium and HSA tax break.

The flat truth: run your own numbers before you pick a plan

There is no plan that wins for everyone. An HDHP with a funded HSA is usually the cheaper choice if you're healthy, can absorb the deductible, and would otherwise leave the premium difference sitting in a checking account instead of an HSA. A PPO earns its higher premium once your spending is high enough, or certain enough, that its lower out-of-pocket max matters more than the HDHP's tax break. The break-even number is the only figure that actually settles the argument for your situation, so use the calculator above with your real premiums, your real plan documents, and your honest guess at next year's spending, not the defaults. For the account mechanics behind the HSA side of this math, see HSA vs FSA: what's the difference, and for the full 2026 HDHP qualification rules, see is a high-deductible health plan worth it.