What purpose does a deductible serve in health insurance plans?

A deductible in health insurance serves primarily to control premium costs and reduce over-utilization of healthcare services. This mechanism works by requiring the insured to pay a specified amount out-of-pocket, typically before the insurance company begins to cover the costs of care.

When people have to pay a deductible, they are generally more conscientious about their healthcare usage, which can prevent unnecessary treatments and keep costs down for both insurers and insured individuals. Moreover, by implementing a deductible, insurers can offer lower premium prices since the risk of frequent small claims is reduced. This balance helps maintain the financial sustainability of the insurance system and ultimately benefits all policyholders.

The other options presented do not capture the primary function of a deductible. For instance, while some plans might cover preventative care without requiring a deductible, that is not the primary purpose of implementing a deductible. Extending coverage to more individuals is typically achieved through broader policy designs and not specifically through deductibles. Lastly, deductibles do not eliminate out-of-pocket expenses; rather, they establish a threshold that insured individuals must meet before their insurance benefits kick in.