Perilous Journey Ahead for HSAs
Show-Me Institute scholars and staffers have written many blog entries, op-eds, and studies dealing with health savings accounts (HSAs). Accompanied with a high-deductible plan, they allow an individual to place money to be spent on health care costs into an account, tax-free. These monies are used to pay for basic procedures under the deductible limit, and encourage customers to find the best prices and shop around.
These plans have been celebrated as a market solution that helps contain health care costs, a mechanism that the new federal health care legislation lacks. Unfortunately — and, perhaps, ironically — HSAs may no longer be an option under the new legislation. Katherine Nix of the Heritage Foundation’s blog The Foundry writes:
Unfortunately, Obamacare threatens to render HSA/HDHP plans a thing of the past. It’s a regulatory thing. It all depends on how the Department of Health and Human Services decides to calculate the actuarial value of HDHPs. According to Roy Ramthun of HSA Consulting, if HHS opts not to “count” contributions to HSAs as part of the actuarial value, then “HDHPs, many of which have actuarial values below 60 percent (or whatever the final standard becomes) based on the insurance coverage alone, could no longer be sold.”
HSAs bring market forces to the health care industry; they minimize the health care wedge between health care consumers and the costs of their care by removing the veil between consumer and price. It would be unfortunate for the nation — and for Missourians, who have enjoyed the opportunity to purchase HSAs since 2007 — if they become no longer a viable insurance option.