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July 05, 2006
House Hearing Reveals Health Savings Accounts are Working
At a House hearing before the Ways and Means Committe, witnesses say Health Savings Accounts are a good idea and seem to be working, but they could use a little tweaking to become more widespread.
Business leaders and insurance representatives said Health Savings Accounts should be tweaked to allow employers to contribute more for chronically ill workers and permit workers to have accounts larger than the deductible of their high-deductible accompanying HSA insurance plan. They also called for more transparency so that their employees have access to the information they need to make healthcare decisions.
"The health and wellness of our employees and their families now and in the future will improve as they take more ownership of their health care decisions," said Jeff Cava, executive vice president of restaurant chain Wendy's International, which switched all of its employees to HSAs three years ago.
Since the switch, the 84 percent employee participation rate in company insurance has remained stable, while in the first year the company's healthcare claims decreased by 14 percent, Cava testified.
To ensure the long-term health of employees is protected, the company has tacked on extras -- like full coverage for preventive care and extra contributions for drug costs.
Karen Ignagni, president and CEO of America's Health Insurance Plans, in her testimony suggested making HSAs more compatible with Flexible Spending Arrangements, and enacting a tax credit to help low-income individuals purchase HSA-compatible insurance.
Opponents of HSA expansion argued they discourage employees from preventive care, are not a viable option for the poor, and may further fragment insurance markets.
"Placing greater financial burdens on the sickest and poorest patients is not the right prescription for what ails the health care system," said Sarah Collins, assistant vice president of health insurance research at the Commonwealth Fund.
The Health Savings Account debate is likely to continue for some time. Here's a great article entitled "The Health Savings Account Debate" which goes into more detail.
Find more information online at http://www.health--savings--accounts.com
Posted by Wiley Long at July 5, 2006 08:09 AM