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December 14, 2006
Health Savings Accounts The Cure for Health Insurance
One of the problems with American health care, as David Gratzer notes in "The Cure," is precisely a payment system that takes the patient out of the equation. In the early 1960s, the average American paid out of pocket one of every two dollars that he spent on health care; today the figure is one dollar in seven. The inevitable effect is hugely wasteful spending and inflated hospital bills. In fact, per-patient costs have gone up almost exactly in inverse proportion to the share of spending borne by the consumer. Can Health Savings Accounts be the answer to these problems?
About 10 years ago, I broke my leg skiing. After I came out of surgery, with a cast stretching from my ankle to the top of my leg, an orderly asked me whether I had ever used crutches before. I hadn't, so he showed me what to do, swinging through them from one end of the room to the other. The whole lesson lasted about 90 seconds. When I got my hospital bill, I saw that I had been charged $150 for "gait training on crutches." I did what all insured Americans do: I forwarded the bill to my insurance company. Why should I care? I wasn't paying for it.
Since then, I have purchased a Health Savings Account and my whole attitude toward healthcare has changed. Dr. Gratzer cites a remarkable Rand Corp. study that tracked health-care spending by 2,000 families over eight years. The families who got free health care spent 40% more than the families with cost-sharing arrangements. And yet the health outcomes for the two groups were the same. The lesson: Market-based health insurance systems, such as Health Savings Accounts, cut out inefficiencies and lower costs without compromising quality.
Find out more about Health Savings Accounts at: http://www.health--savings--accounts.com
Posted by Wiley Long at December 14, 2006 08:58 AM