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September 27, 2006
Health Savings Accounts Needed to Change Medical Mindset
For a fresh analysis of health care, people ought to look to economist Arnold Kling's new book, Crisis of Abundance. Although it offers no easy villain-versus-hero narrative or solution to the challenges of funding health care, it diagnoses the problem with precision.
The perfect health-care system, Kling argues, would achieve three goals...
It would offer unfettered access; people could receive all the care they needed when they needed it. It would insulate people from extreme health-care expenses. It would be affordable for society as a whole, meaning that health spending wouldn’t sacrifice other public and private needs.
We can’t have all three of these goals. No country or economy can. Socialized systems provide insulation and achieve affordability at the expense of unfettered access.
In Canada, the average wait to see a specialist is 17 weeks. The newly-elected president of the Canadian Medical Association told the New York Times, “This is a country in which a dog can get a hip replacement in under a week and in which humans can wait two or three years.”
The U.S. health-care system mangles these goals. For example, most people are insulated and, compared to most countries, have unfettered access to expensive medicine. The average person consumes more than $5,000 worth of health care but spends only $1,029 out of pocket.
This insulation from transparent expenses and access pushes total health spending up. Individuals pay in reduced salary. The insulation makes the insurance more expensive, thereby causing employers to drop insurance and individuals to elect not to purchase it. Eventually, we will all pay in increased taxes to support Medicare and Medicaid.
While no perfect solution, there are sound ways to address the issue. The first is honesty. If we want top-tier health care, it will be costly. The question is how to pay. Advocates of greater pooling must confront and quantify the increased taxes or rationing that such programs would necessarily entail.
A better approach is to put the insurance back into health insurance with high deductible plans that allow for long-term insurance protection. While we are young and healthy, most of us will self insure and accumulate money in health savings accounts. When we grow older and need more care, we will have a combination of private money and insurance to insulate us from the devastating expenses of modern medicine. The very poor will be taken care of collectively through Medicaid.
An individual’s spending on health care would be transparent under such a system, rather than obscured as it is today. Access would remain unfettered. Most important, people would be insulated from devastating medical expenses.
The biggest obstacle to this transformation is the American mindset, which views health care as something that should be free. For Americans to truly manage health-care expenditures, we must see it as akin to other life necessities, food, housing, clothing, and transportation. The truly needy are provided for collectively, through government programs. The rest of us, must budget for routine expenses and insure against catastrophe.
Go to http://www.health--savings--accounts.com to learn more about Health Savings Accounts
Posted by Wiley Long at 08:56 AM | Comments (1)
September 25, 2006
Humana Introduces Individual Health Savings Account Plans in Oklahoma
Humana Insurance Company has announced the introduction of its HumanaOne line of individual health insurance and health savings account plans in Oklahoma. HumanaOne is designed to offer affordable health insurance coverage along with a great degree of choice, freedom and flexibility, giving individual consumers an important new alternative in Humana, one of the nation's largest health benefits companies.
"Humana saw an opportunity to offer something of lasting value for consumers at a time when fewer employers are offering health benefits," said Tod Zacharias, president of HumanaOne. "HumanaOne was created with the consumer in mind, and includes a variety of plan options and features meant to affordably meet the consumer's need for individual health insurance coverage."
HumanaOne is built to appeal to individuals and families not insured by their employer, including self-employed entrepreneurs, small business employees, part-time workers, students, early retirees and others needing affordable health insurance coverage. HumanaOne first debuted in Illinois in June of 2002 and is now available in a total of 24 states - Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Illinois, Iowa, Indiana, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nebraska, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah and Wisconsin.
"In many locations, there are only a handful of companies offering individual health insurance coverage, so our plan should come as welcome news for consumers," said Diane Loram, HumanaOne sales manager for Oklahoma. "These plans are priced competitively to fit within the consumer's budget."
According to Zacharias, Humana's size allows the company to secure volume discounts from doctors and hospitals across the nation. "Unlike many other individual health carriers, Humana most often contracts directly with physicians and other health care providers," said Zacharias. "By owning our own networks, we can achieve greater cost savings and pass those savings along to consumers."
HumanaOne offers the HumanaOne Individual Health Plan, an individual major medical plan, and the HumanaOne HSA, a high deductible health plan compatible with a personal Health Savings Account administered by Chase or a qualified bank of the consumer's choosing. These plans provide preventive care, prescription drug and emergency room coverage, as well as a choice of annual deductible. Each plan includes a range of options, enabling consumers to customize the plan to their specific needs. Optional benefits include individual term life insurance and a dental benefit insured by HumanaDental Insurance Company, Humana's dental insurance subsidiary.
HumanaOne's PPO arrangement allows consumers to visit any doctor or health care provider they choose, or they can receive the highest level of benefits by visiting one of the doctors, hospitals and other facilities within Humana's network. Humana, through the ChoiceCare Network, Humana's national PPO network, contracts with more than 300,000 health care providers in all 50 states. Humana's national presence also means those who work or travel outside Oklahoma can receive in-network benefits from any contracted physician or health care provider, which is advantageous for frequent travelers, students attending college away from home and anyone who moves to a new state.
HumanaOne is marketing its individual health insurance plans through its nationwide network of approximately 25,000 actively appointed independent insurance agents and brokers. "We have longstanding and well-established relationships with insurance professionals across the country, and we are relying heavily on them to bring HumanaOne to the marketplace," said Loram. As in other states, Humana will promote HumanaOne through advertising and direct mail campaigns in Oklahoma.
HumanaOne features a streamlined application process, enabling consumers to apply online or by phone. In addition, HumanaOne guarantees premium rates on all plans for one full year after purchase, provided the customer maintains the same benefits and resides within the same geographic area.
Learn more about HumanaOne HSA at http://www.health--savings--accounts.com/humana-hsa.htm
Posted by Wiley Long at 08:52 AM | Comments (0)
September 22, 2006
Blue Cross Blue Shield Survey Shows Health Savings Account Popularity
The popularity of Health Savings Accounts (HSAs) is equally distributed across consumers aged 25 to 54, with demand also coming from all income and education segments of the population, according to a new survey released by the Blue Cross Blue Shield Association (BCBSA).
The survey found that HSA products are on par with non consumer-directed health plans (CDHPs) with 85 percent of respondents saying the product meets or exceeds expectations for controlling healthcare expenditures.
The survey also revealed that 47 percent of those consumers with HSAs experienced an increase in satisfaction over the previous year, while only 27 percent of consumers with traditional health plans showed an increase in satisfaction.
"We are encouraged that satisfaction levels with HSAs continue to be positive and expect that increasing numbers of companies and organizations will offer HSA options to employees," said Maureen Sullivan, senior vice president, Strategic Services, BCBSA. Sullivan presented the findings today at the National Consumer-Driven Healthcare Summit in Washington, D.C.
In 2006, 57 percent of HSA-eligible enrollees opened HSA accounts. The survey also found that 38 percent of account holders select HSAs for greater control over their healthcare spending, 46 percent because HSAs are less expensive, while 38 percent of account holders view HSAs as a long-term healthcare savings vehicle.
HSA products also continue to be an attractive option for the uninsured. Ten percent of consumers with HSA accounts opened were previously uninsured as compared to 3 percent for the traditional market.
In contrast to those with traditional health insurance, the survey found that those with HSA accounts are more likely to show interest in getting access to information about wellness programs as well as information about providers and pharmaceuticals.
The Web-based survey conducted this past August by Knowledge Networks for BCBSA queried 3,000 consumers enrolled in Blue Cross and Blue Shield CDHPs, non-Blue CDHPs, and non-CDHP health plans. The survey examined areas such as demographics, member expectations, satisfaction, healthcare utilization and likelihood of renewal.
"The companies of Blue Cross and Blue Shield are doing business differently in a consumer-driven world. They are putting in place key programs that support CDHPs and HSAs," Sullivan said.
In support of these programs, Blue Cross and Blue Shield companies recently have announced major consumer healthcare transparency initiatives with the launch of Blue Distinction and Blue Health Intelligence (BHISM). Blue Cross and Blue Shield Plans are also continuing to develop a financial services program to respond to the increasing demands of the consumer-directed marketplace. The number of Blue Cross and Blue Shield members currently with HSAs has doubled to 1.2 million account holders in 2006 -- approximately 40 percent of the total HSA market.
Learn more about Health Savings Accounts and see if an Health Savings Plan is right for you.
Posted by Wiley Long at 09:30 AM | Comments (0)
September 20, 2006
Rewarding Health Savings Account Workers for Improving Health
Recent federal rule clarifications regarding Health Savings Accounts (HSAs) will let employers put more money into the HSA accounts of employees who participate in health-wellness programs and improve their health as a result.
Such incentives will be allowed starting at the beginning of 2007 due to a clarification handed down by the U.S. Department of Treasury earlier this summer. Wellness-program advocates say such incentives could cause more people to take part in the programs and that could lead to a healthier work force, which ultimately would help keep employers' insurance premiums down.
“In the end, it does make a huge difference,” says Kathy Gordon, director of the work-site health promotion program at the Physician Hospital Community Organization, a Spokane-based health-plan administrator commonly known as the PHCO.
For employers, health savings accounts are said to be a less-expensive alternative to offering conventional group health-insurance plans that carry low deductibles for insureds. Health savings accounts are used in tandem with a high-deductible health plan, sometimes referred to as an umbrella plan or a major-medical plan.
Generally speaking, an employer pays for the umbrella plan and also puts a certain amount of money into each employee’s health savings account at regular intervals. The employee also contributes pre-tax money to his or her account, usually through payroll deduction.
Mark Newbold, employee-benefits adviser for Spokane-based Moloney O’Neill Benefits, says federal guidelines set the minimum deductible for umbrella plans at $1,050 for individuals and $2,100 for families. Oftentimes, however, employers chose umbrella plans with much higher deductibles than that, greater than $2,000 for individuals and more than $2,500 for families, to realize cost savings.
Account holders use money accumulated in their accounts to pay for medical expenses up to the amount of deductible under the umbrella plan, and the umbrella plan’s coverage kicks in once expenses exceed that amount.
Because employees manage their own health savings accounts, the accounts are seen as a way to encourage employees to shop carefully for health-care services—ideally holding down costs through their own decision-making ability. Money that isn’t used in the year it’s contributed to an account can be carried over into following years. Employees can withdraw money from the account at any time for expenses not related to health care, but they then must pay income taxes and a penalty for doing so.
Federal guidelines set the maximum annual contribution amount, by both an employer and an employee, at the lower of the following: 100 percent of the plan’s deductible or $2,700 for individuals and $5,450 for families.
Wellness programs can be beneficial regardless of the type of health plan a company offers, Newbold says. He says, though, that offering wellness programs in conjunction with health savings accounts is especially important. Since employees manage their own accounts, they should try to remain healthy to keep from depleting their accounts.
“The two have to go hand in hand,” Newbold says. “One without the other, in the long run, is not going to accomplish the goals that you have.”
The PHCO and Community Health Association of Spokane are among those that offer wellness programs.
The PHCO conducts wellness fairs for companies in order, first, to educate people about how to lead a healthy lifestyle, then to help them monitor progress as they work to improve their health, the organization’s Gordon says.
At such an event, she says, the PHCO offers to test cholesterol, blood-sugar levels, blood pressure, body-fat percentage, body-mass index, hip-to-waist ratio, and bone density. It also offers a confidential health-risk assessment survey that covers general health, depression, stress and anxiety, and headaches, among other conditions.
Without divulging the details about any individual’s health, the PHCO puts together a companywide report on employees’ health for an employer to address in general terms where its work force stands in terms of health and makes recommendations of programs that an employer might consider offering based on that information, Gordon says. For example, she says, the organization has put together weight-loss programs for some companies and heart-health programs for others.
The organization has conducted wellness fairs annually for some employers—free of charge for employers whose plans the PHCO administrates—and it now has multiple-year results for some employees, Gordon says.
Incentives that involve adding more money to a person’s health-savings account likely will be geared toward encouraging people to attend wellness fairs or similar events, then eventually will evolve into incentives for showing results of improved health, such as lower blood pressure or an improved body-mass index.
Employers offer different kinds of incentives to workers to lure them to such events. For example, she says, one employer offered $25 gift certificates to employees who attended a wellness fair. The promotion worked well, she added; the event attracted more than 100 people, compared with an earlier event by the same employer that drew only 40 people.
“It would be nice if everybody wanted to be healthy, but usually it takes the incentives to get them to opt into the program,” Gordon says.
Health savings accounts were created in 2003. While they’ve have been touted for their cost savings for employers and the control they give employees, Newbold says they’ve received mixed reviews so far.
Inevitably, when a company begins offering such accounts, some workers will incur substantial health-care costs before they have enough money built up in their accounts, Newbold says. That means some employees could face substantial out-of-pocket costs, he says.
He says that health insurance claims typically follow the 80-20 rule, in which 80 percent of the claims are filed by 20 percent of the insureds, which can mean that health savings accounts might not work well for a company and its employees in the early days of such a program.
“Can employers get through that transition period knowing that 20 percent is going to be adversely effected?” he says.
Generally speaking, he says, health savings accounts receive positive remarks from professional concerns where the bulk of the employees make comparable wages, but companies with stratified work forces often have lower-paid employees encounter more problems in making the program work satisfactorily for them.
Find out more about Health Savings Accounts at http://www.health--savings--accounts.com
Posted by Wiley Long at 09:02 AM | Comments (0)
September 18, 2006
Final Inflation Adjusted Health Savings Account Numbers for 2007
With the release of the August 2006 inflation figures, the inflation-adjusted amounts for Health Savings Accounts (HSAs) for 2007 are now known, says Roy Ramthun, Senior Vice President of HSA Clearing Corp. "We now know all the data points to calculate 2007 numbers for HSAs. The maximum HSA contribution (not including catch-up contributions) will be $2,850 for self-only coverage and $5,650 for family coverage in 2007." The annual catch-up contribution for individuals age 55 or older is set by statute and will be $800 per person for 2007.
Ramthun says that for insurance plans offering HSA qualified health savings plans, "The minimum deductible for HSA-qualified high deductible health plans (HDHPs) will be $1,100 for self-only coverage and $2,200 for family coverage policies. The out-of-pocket maximums in 2007 will be $5,500 for self-only policies and $11,000 for family coverage policies.
Now that these figures are known, companies can begin to finalize their 2007 plans, even though the official inflation adjusted amounts for HSAs will not be published by the IRS until later this fall, says Ramthun.
Find out more about Health Savings Accounts at: http://www.health--savings--accounts.com
Posted by Wiley Long at 09:03 AM | Comments (2)
September 16, 2006
As Health Costs Rise, Health Savings Account Owners Must Get Smarter
As more companies offer Health Savings Account (HSA) plans to their workers, a leading proponent of the trend says that employers also must help patients become smarter shoppers for care.
Companies that successfully deliver both halves of the equation -- offering the HSA insurance policies and providing good information about the cost and quality of medical services -- will help bring true "consumerism" to health care, said Ann Mond Johnson, president of Subimo LLC, during an address to the annual health care symposium sponsored by the Pittsburgh Business Group on Health.
"You don't do it just because of the dollars," said Ms. Johnson during a speech to more than 300 people registered for the Downtown meeting at the Marriott City Center. "You do it because it's the right thing."
Ms. Johnson's company, of course, makes a business out of trying to give such information to consumers. In April, Highmark Inc., the region's largest health insurer, announced that its member Web site would begin displaying information about hospital quality as compiled by Subimo.
The Chicago company pulls information from publicly-available reports, such as those published by the Pennsylvania Health Care Cost Containment Council. It also provides information on how often different hospitals perform a given procedure, which can be an indicator of quality.
A slide that Ms. Johnson displayed, for example, showed that the Cleveland Clinic performed more than five times as many heart valve replacement and repair surgeries as Allegheny General Hospital and West Penn Hospital. While acknowledging that it is difficult to provide comprehensive quality information about many types of medical care -- there are more than 160 variables that affect the quality of any given heart valve replacement surgery, she estimated -- Ms. Johnson predicted a day will come when consumers book their surgeries much as they do airline flights on Orbitz.com.
"As you put this information out there, you will see consumers starting to shop," she said.
The move to consumerism in health care is happening as social values are changing about personal responsibility for health risks, Ms. Johnson said. The share of people who think it's OK for employers to publicly declare they won't hire smokers, for example, is growing, she said, adding that similar opposition could be building against obesity.
The share of companies offering high-deductible health plans has steadily increased in recent years, with 33 percent of employers surveyed this year by the National Business Group on Health saying they plan on offering some version of the insurance product in 2007. But Kim Bellard, a vice president with Highmark, said the adoption of Health Savings Accounts in the local market has been slower. A local survey this year by Cowden Associates, a Downtown benefits and actuarial firm, suggested that about 11 percent of companies here offered high deductible health plans between July 2005 and April 2006.
Health Savings Account plans will continue to grow as more information on healthcare becomes availble to make wise consumer decisions. Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com
Posted by Wiley Long at 09:37 AM | Comments (1)
September 14, 2006
Surgery Abroad an Option for Health Savings Account Owners
Going overseas for cheaper medical treatment, also known as "medical tourism", is one of the fastest-growing trends in modern health care. Owning a Health Savings Account gives you the option to spend your healthcare dollars on such options.
While no one officially tracks the medical tourism phenomenon, the statistics at Bumrungrad International Hospital in Bangkok, Thailand, give a sense of how fast it is growing.
- Last year, Bumrungrad treated 58,000 American patients, 70 percent of whom traveled there especially for such procedures as hip and knee replacement, angioplasty and prostate removal, said spokesman Ruben Toral.
- That was 25 percent more U.S. patients than it treated in 2004, he said, and so far this year, American patients are running 20 percent above last year's figures.
At Bumrungrad Hospital, Toral said, the lower cost of living is a major factor in the savings, but so are differences in how the medical system operates:
- Doctors in Thailand pay about $5,000 a year for malpractice insurance, compared with more than $100,000 for some specialties in the United States.
- Thai courts will adjudicate malpractice claims, but the largest award ever issued was about $100,000 and the law there doesn't permit damages for pain and suffering.
- Another major savings is that Bumrungrad doesn't have to spend much on processing insurance claims, since 75 percent of its patients pay cash.
"You can come to our hospital and pay for major surgery on your credit card," he said. "You could never do that in the states."
Being a Health Savings Account owners affords you the luxury of keeping your options open. If "medical tourism" is a viable option for you, it's nice to know you can use your HSA to cover the cost. And not just the cost of the treatment, but the cost of the entire trip.
Learn more about Health Savings Accounts and how you can use them to your advantage at http://www.health--savings--accounts.com
Posted by Wiley Long at 08:15 AM | Comments (0)
September 12, 2006
Surgery Abroad an Option for Health Savings Account Owners
Going overseas for cheaper medical treatment, also known as "medical tourism", is one of the fastest-growing trends in modern health care. Owning a Health Savings Account gives you the option to spend your healthcare dollars on such options.
While no one officially tracks the medical tourism phenomenon, the statistics at Bumrungrad International Hospital in Bangkok, Thailand, give a sense of how fast it is growing:
- Last year, Bumrungrad treated 58,000 American patients, 70 percent of whom traveled there especially for such procedures as hip and knee replacement, angioplasty and prostate removal, said spokesman Ruben Toral.
- That was 25 percent more U.S. patients than it treated in 2004, he said, and so far this year, American patients are running 20 percent above last year's figures.
At Bumrungrad Hospital, Toral said, the lower cost of living is a major factor in the savings, but so are differences in how the medical system operates:
- Doctors in Thailand pay about $5,000 a year for malpractice insurance, compared with more than $100,000 for some specialties in the United States.
- Thai courts will adjudicate malpractice claims, but the largest award ever issued was about $100,000 and the law there doesn't permit damages for pain and suffering.
- Another major savings is that Bumrungrad doesn't have to spend much on processing insurance claims, since 75 percent of its patients pay cash.
"You can come to our hospital and pay for major surgery on your credit card," he said. "You could never do that in the states."
Being a Health Savings Account owners affords you the luxury of keeping your options open. If "medical tourism" is a viable option for you, it's nice to know you can use your HSA to cover the cost. And not just the cost of the treatment, but the cost of the entire trip.
Learn more about Health Savings Accounts and how you can use them to your advantage at http://www.health--savings--accounts.com
Posted by Wiley Long at 08:06 AM | Comments (0)
September 10, 2006
Health Savings Accounts See Surge in Sign-ups
Health savings accounts aren't just for the "healthy and wealthy".
More than 50,000 HSA accounts are opened every month in the United States, according to account administrators, showing the dramatic effect of a relatively new insurance alternative.
"This is the best thing I've seen in health care — and I've been doing this for 31 years", said Tom Voake, a partner in Effective Choices, a group benefit specialist team that is part of Strategic Financial Partners.
“The HSA concept is a strategy, one that allows people to plan for the future by putting the money aside today. In my opinion, this option is perfect for people who have chronic illness.”
Health savings accounts are generally combined with a high-deductible health insurance plan. Once the deductible is met, the insurance companies pay 100 percent of covered medical costs.
In the two and a half years since HSAs were created as part of the Medicare Prescription Drug, Improvement and Modernization Act, consumers and employers have embraced the insurance alternative. In Colorado, more than 26,000 people have health savings accounts, according to the Department of Insurance.
“These plans are unique, they offer no up-front co-pays, but all the money comes out of pocket until the deductible is met,” Voake said. “That’s where the savings accounts come in. They’re portable — like a medical IRA — and have a great tax advantage.”
But the idea is still new, and can be confusing. Voake said the biggest issue is getting employers to realize that the plans have separate parts: the high-deductible insurance plan and the savings accounts.
The high-deductible creates lower premiums, but people must also pay into a savings account to cover health-care costs, he said. That’s where the tax advantage comes in.
Money that is put into a health savings account is not taxed, Voake said, and it isn’t taxed when it’s taken out to pay for medical costs. The federal government limits the amount of money put into a plan, but the lower premiums make saving money for the HSA easier, he said.
“With escalating premium costs for traditional preferred provider or health maintenance plans, employers and consumers can actually save money using a HSA,” Voake said. “You put the money in on a monthly basis, and depending on the employer, there will be some contributions on that end as well.”
Employers can save millions on health insurance costs using the HSA plans — particularly those that pay an employee’s entire premium, he said. But switching to the plans requires a shift in thinking.
“People have to realize how much it really costs to go to the doctor,” Voake said. “Not just their $20 co-pay, but what it actually costs. For some people, it’s too much trouble. But this plan allows people to become educated about what it costs and how controlling that cost benefits them — it’s their money. The biggest hurdle is giving up the prescription cards and taking control of where their money goes. It definitely requires a different thought process. It requires a strategy to pay those up-front costs. But they don’t have a strategy to pay the out-of-pocket costs from a traditional plan.”
Voake said that everyone — regardless of income — can benefit from the health savings accounts. It’s a belief echoed by major insurance companies.
Rocky Mountain Health Plans offers two health savings account plans. Vice President Jim Swayze said the company has seen substantial growth this year in inquiries about the plans.
“There’s a lot of confusion surrounding the plan,” he said. “And so a lot of what we do is communication and education. HSAs can serve a great purpose, but there’s a lot to understand. We expect that people will be signing up as they find out more about the plans and how they work. It can be complex; a lot of it depends on employer contributions and out of pocket alternatives.”
Rocky Mountain Health Plans caters to small companies in Colorado, and Swayze said that most applicants are not from the upper tier income level. He believes that average employees could benefit from the plans — and small businesses that don’t offer health insurance could start, thanks to the lower premiums that come from high deductible health insurance.
Interest in HSAs is growing so quickly that some benefits specialists are predicting the end of traditional insurance. The trends certainly support that outlook: forecasts are that the number of employers offering HSAs will quadruple this year, according to Mellon Financial Group.
And Voake believes the consumer-oriented plans will catch on. Their tax benefits, portability and roll-over status make them attractive to businesses and employees, he said.
“HSAs have long-range benefits,” Voake said. “By the time you’re 65, most of us can’t afford a qualified plan. But you’ve created a pot of money that they can take out to pay Medicare premiums, they can pay for medicine. And they’re not taxed for it. It’s a way to fund retiree medical costs that we haven’t had before.”
The plan also allows people to withdraw money from an HSA for non-medical reasons, he said. That money is taxed the same way a 401(k) withdrawal is taxed.
But some insurance companies believe traditional plans still have a place for employers. At Aetna, Jeff Miller said interest in the plans is rising, but the number of people enrolling in the plans is steady.
“We see far more interest in the plans than we do people signing up for them,” he said. “We have about half a million nationally covered under these consumer-driven plans. So the adoption rates are much less than the interest levels. Basically, it boils down to each customer’s specific needs.”
Voake believes it’s only a matter of education — and of getting people involved in making their own health care decisions.
“I personally think everyone should have one,” he said. “Some people don’t want to be involved, they find it’s easier to deal with a drug card and not worry about the dollars and cents. But this gets people involved in the real costs — medicines don’t cost $10.”
Learn more about Health Savings Accounts at HSA for America - http://www.health--savings--accounts.com
Posted by Wiley Long at 09:18 AM | Comments (0)
September 08, 2006
An Overview of Health Savings Account Benefits and Guidelines
For many small employers, the cost of employee health benefit programs have skyrocketed over the last decade. Unfortunately, the cost of providing health insurance coverage to employees is considered burdensome and often overlooked by employers due to the mere fact of affordability of premiums. In an effort to resolve the increasing number of uninsured Americans, the introduction of Health Savings Accounts (HSA), offers employers and employees an alternative to traditional health insurance plans.
Considered a savings program, Health Savings Accounts, are generally coupled with a high premium insurance plan commonly referred to as a High Deductible Health Plan or HDHP. With an HDHP, employers pay a significantly lower insurance premium and provide a catastrophic type insurance plan for employees. This catastrophic insurance plan, as it states, comes with a very high deductible and limits the benefits available to employees. To offset the deductible costs to employees, and to avoid higher premiums for lower deductible plans, employers will turn to Health Savings Accounts (HSA)s as a financial investment tool.
Often opened with an initial investment by the employer, employees are permitted to invest their own money into the health savings plans. The concept being any money normally spent on insurance premiums would be invested into the Health Savings Account on a pre-tax basis with annual contributions not permitted to exceed the amount of the deductible on the HDHP. In other words, if you, or your employer, choose to purchase an HDHP with a catastrophic deductible of $2500.00, the limit you can invest into an HSA would be $2500.00 and is pro-rated based on the date coverage goes into effect for the first year. Taxable income, for income tax purposes, is then reduced by the amount of contribution made during the year. Itemization of deductions is not required to receive the tax benefit of an HSA contribution.
Utilizing an HSA is quite simple. Upon incurring medical costs, your claim should first be filed with your High Deductible Health Plan carrier. Upon receipt, the HDHP carrier will adjudicate the claim in accordance with their fee guidelines and submit an explanation of benefits (EOB) to both you and your physician. Upon receipt of the EOB, determine the amount applied to your deductible and then submit this amount to your HSA for payment. It's that simple. In addition to the ease of HSA claims processing, the Health Savings Account interest and other earnings to the account are considered tax free. Best of all, the HSA plan is portable and can be moved from employer to employer.
Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com
Posted by Wiley Long at 08:47 AM | Comments (1)
September 06, 2006
Doyle Obstructs WI Health Savings Account Reforms
WI Gov. Jim Doyle recently vetoed legislation on Health Savings Accounts (HSAs) for the third time. This legislation would have matched the federal tax deduction for HSAs. These accounts are unique in the fact that they consist of contributions used for minor medical expenses, allowing participants to spend less money on high-deductible catastrophic coverage. With this third veto by Doyle, it should be noted that Wisconsin is one of only four states that have not as yet approved HSA legislation.
Viewpoint
Special Report: Insurance & Employee Benefits
By Dean M. Hoffman
I am an employee benefit consultant and an active member of both the National Association of Health Underwriters (NAHU) and the Wisconsin Association of Health Underwriters (WAHU).
It has been said by many here in Wisconsin, but I am going to say it again: Wisconsin cannot afford to allow another term for Gov. Jim Doyle. He is against what is best for Wisconsinites, who struggle every day to keep up with their skyrocketing health care costs. This will continue the pain of employers trying to do business here in Wisconsin.
The governor tried to justify his actions with the argument that HSAs are only for the “healthy and wealthy.” This statement is simply not true. A study released by America’s Health Insurance Plans, eHealthInsurance and Assurant Health, shows that 27 percent of HSA purchasers have a net worth of less than $25,000. In addition, it was recently reported that nationally, one third of those who have enrolled in HSAs were previously uninsured.
The governor further defended his veto position by stating, “HSAs are inextricably linked to high-deductible medical insurance and therefore could decrease employer-sponsored insurance coverage.”
No study has shown tax-free HSAs lead to employers dropping health insurance coverage. In fact, anecdotal evidence supports the opposite conclusion. It is true that HSAs are linked to high-deductible insurance; but those plans are less expensive than low-deductible plans, making it easier for employers to continue providing coverage.
Not only are HSAs helping more Americans afford health insurance, they also are addressing the issue of rising health care costs. HSAs give consumers a reason to be value-conscious shoppers in the health care marketplace. When individuals pay more attention to the cost of health care and demand value for their dollars, they become better consumers and thus total health care spending will decline.
I believe a better system can be realized when Wisconsinites have choice and control over their health care decisions – with patients working alongside doctors to make those decisions. The best way to do this is through choice and competition, which can work in the health care arena as they have in most sectors of our economy by encouraging innovation, transparency and stimulating new ideas for controlling costs and delivering care in a more effective way.
Dean M. Hoffman is the director of large group services at Diversified Insurance Services Inc. in Waukesha and has been in the employee benefit industry for more than 30 years. He is a past president of the Wisconsin Association of Health Underwriters and the current membership chair for Region 4 of the National Association of Health Underwriters. NAHU/WAHU is an association of highly qualified health insurance professionals with 22,000 members in the United States and more than 560 members in Wisconsin.
Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com
Posted by Wiley Long at 11:12 AM | Comments (0)
September 04, 2006
Free Health Care is a Fatal Notion
Although national health care may be the Holy Grail of American liberalism, Amy Ridenour of the National Center for Public Policy Research sees this model more as a poisoned chalice.
A better option would be for our government to adopted liability reform, interstate medical insurance sales, unhindered health savings accounts and other pro-market improvements.
It would be bad enough if a national health care system merely offered patients low-quality treatment. Even worse, Ridenour finds, it kills them:
- Breast cancer is fatal to 25 percent of its American victims; in Great Britain and New Zealand, both socialized-medicine havens, breast cancer kills 46 percent of women it strikes.
- Prostate cancer proves fatal to 19 percent of its American sufferers; in single-payer Canada, this ailment kills 25 percent of such men and eradicates 57 percent of their British counterparts.
- After major surgery, a 2003 British study found, 2.5 percent of American patients died in the hospital versus nearly 10 percent of similar Britons; seriously ill U.S. hospital patients die at one-seventh the pace of those in the United Kingdom.
In addition, medicrats often distribute resources based on politics rather than science, leaving a disorganized and inefficient system for many patients, says Ridenour:
- In usual circumstances, people over age 75 should not be accepted for treatment of end-state renal failure, according to New Zealand's official guidelines, unfortunately government controls kidney dialysis.
- According to a Populus survey, 98 percent of Britons want to reduce the time between diagnosis and treatment.
For all its problems, says Ridenour, the United States' more market-friendly health system offers patients better care and would deliver greater advancements if government adopted liability reform, interstate medical insurance sales, unhindered health savings accounts and other pro-market improvements.
Posted by Wiley Long at 03:35 PM | Comments (0)
September 02, 2006
Aetna Provides Health Savings Account Owners with Advance Peek at Doctors' Bills
Aetna has began allowing members to have access to pricing information before they go to a doctor's office. Previously, they learned what the insurer paid only when they received an explanation of benefits report weeks after treatment.
Aetna expects the pricing information to be most useful to the small but growing number of customers who have health savings accounts tied to a high-deductible insurance plan that require consumers to pay for most of their routine care out-of-pocket. The decision to release the data is part of Aetna's larger effort to make consumers better health-care shoppers.
The information helps consumers doctor shop because rates can vary. For example, Aetna pays West Palm Beach orthopedic surgeon Pierre Girars $1,713 for a hip replacement. But it pays another West Palm Beach orthopedic surgeon, Milan DiGiulio, $1,456 for the same procedure. Doctors get paid differently because they negotiate with insurers separately.
Although most large U.S. health insurers disclose some cost and quality data on hospitals and doctors, Aetna is the first to provide the doctor-specific pricing information to its members via the company's password-protected Web site (Aetnanavigator.com). Insurers have closely guarded payment data in the past, citing competitive pressures. Aetna is the nation's second-largest health insurer with more than 15 million members.
The company said not only health savings account owners will benefit. Even those customers in its traditional HMOs or PPOs will benefit because it will help them appreciate the true cost of their health care.
"Some people still think the cost of their health care is their $10 or $15 co-payment," Dr. Charles Cutler, Aetna's national medical director, said Tuesday. "This will help raise the level of awareness about the difference in costs and support the whole consumerism approach where people make decisions about health care the same way they act in other domains."
Aetna's member Web site also discloses whether the doctors met certain Aetna quality and efficiency standards, but it provides no specifics.
During the past decade, the federal government, most states and private health insurers have been giving consumers a growing amount of cost and quality data to compare doctors and hospitals. But some health analysts and doctors question whether consumers even look at it.
Dianne Howard, risk management director for the Palm Beach County School District, applauds Aetna's effort to give consumers more data to make decisions. "This is part of the whole transparency movement in health care," she said.
Most school district employees get their health benefits through United Healthcare. Nonetheless, the data showing what doctors get paid would be enlightening to employees used to paying a small co-payment for their care, she said.
Aetna tested its new doctor-pricing data in Cincinnati last year. In that market, about 1,000 consumers each month looked at the database, Aetna officials said.
In addition to South Florida, the program is being rolled out in other markets, including Ohio, Connecticut and the Washington, D.C., area.
Some health analysts predict that, in a few years, most consumers will be getting their health insurance through health savings account/high deductible plans and they'll want to shop for health care the same way they do for a new car.
"Employers will demand to have this type of information for their workers," said Stephen Hudack, a Palm Beach-based director of Frank Crystal & Co., an insurance brokerage. He predicts other insurers will release similar data. "You can't negotiate if you don't know what the price is."
This is a great trend in healthcare and price transparency will continue to get better. Learn more about health savings accounts at http://www.health--savings--accounts.com
Posted by Wiley Long at 02:43 PM | Comments (0)