Early Data on Health Savings Accounts

The General Accounting Office released data from a study on people with health savings accounts. This can be added to the recent study of Midwest farmers using high deductible health plans to get a picture of the impact of the President’s signature program to reign in health care costs.

The report studied only people with high deductible plans and funded health savings accounts. No statistics were gathered for people under such plans without a HSA. Some key results for the under 65 age group are below:

· 51% of people with HSA’s make $75,000 or more vs. 18% of the general population
· Average age of HSA funders was 9 years higher than the general population according to IRS data
· 55% of HSA eligible plan enrollees contribute to their health savings account while 45% do not.
· Many participants were unsure about what medical expenses qualified for payment under their HSA
· Few researched the cost of hospital or physician services before obtaining care
· Participants said they would recommend HSA’s to healthy consumers, but not to people who use maintenance medication, have a chronic condition, have children, or may not have the funds to meet a high deductible.

The Bush plan has the bargaining power of the individual patient driving down the cost of health care where the government (with 80 million insureds) failed. Almost half of those eligible for HSA’s don’t fund them, so they miss any tax benefits. These folks bear the costs associated with high deductible care with after tax money. Their experience likely mirrors the Kansas farmers who found rising medical debt the benefit of high deductible health plans.

Another Bush initiative fails to live up to its promise. Sure it’s early, but staying on this track avoids more fundamental, systemic reforms. Bush’s aim is to reduce employer and government sponsored coverage shifting responsibility for health care back to the individual. The data shows who benefits from his plans, the wealthy and the healthy. In other words the people who don’t need much health care and can already afford it!