Health Savings Account Blog

One company, United Healthcare underwritten by Golden Rule, says 42 percent of its entire customer base now is covered by an HSA policy. Incredibly, these HSA customers already have accumulated an astounding $141 million in their savings accounts.

This is proof that HSAs are working the way Congress intended when it passed a bipartisan bill making HSAs available to all Americans in 2003. That $141 million is controlled by consumers who can use it to meet health care or retirement savings needs.

This is money that, in the usual third-party payment setup, would go to insurance firms or get lost in the maze of the health care system.

The average premium for an HSA-qualified individual high deductible health insurance policy went down by 19 percent in the first half of 2005. The monthly premium dropped from $137.94 to $111.57, saving consumers more than $300 a year.

Given the bad news about rising health insurance costs, which leave 45 million Americans without coverage, this data helps explain why the market is increasingly taking this route. According to the Kaiser Family Foundation, people insured by employer-provided HMO, PPO and POS policies are paying an average of $308 in monthly premiums -- almost $200 more than those insured by HSAs.

The impact on consumers, especially low-income consumers who were previously uninsured, has been substantial. Just under half of the Health Savings Account customers who bought their policies here at HSA for America had incomes of less than $15,000 had been previously uninsured for at least six months. Of those with incomes between $15,001 and $35,000, 43.4 percent were previously uninsured for at least half a year before obtaining an HSA policy.

With an HSA in conjunction with a high deductible health insurance HSA Plan, money is placed into a health account tax free, grows tax free, and can be withdrawn tax free as long as it is used for medical purposes. Any money left in the account at the end of the year can be rolled over to the next year.

The Health Savings Account grows, building resources a patient can use for medical care. And since the money belongs to the individual, Health Savings Account users pick their doctors and hospitals -- no referrals needed. When individuals have more control over health care spending, they become better consumers and health care costs are driven downward. This is Consumer Driven Health Care at work.

As more Americans discover the advantages of HSAs, and as more companies offer them, consumers will be able to affordably insure themselves. Because HSAs are portable, individuals won't necessarily have to worry about losing coverage if they change jobs, lose a job or want to start a business.

Lower costs, more choice and an opportunity to build savings? Perhaps our current health care crisis is on the mend because of Health Savings Accounts.