Someone Explain Health Care Savings Accounts to me

[bleedingheart]

This is what I think they are...

Individuals put money into an account that is strictly for healthcare expenses. Unlike the flexible spending dollars...these funds can roll over into a new year.

The person can contribute as much as they choose and typically it is combined with a low cost but high deductible insurance ($5000 for families, $1500 for singles)..

So you pay for all your prescriptions, your doctor's office visits and the lab tests and all the other crap....until you hit that deductible limit...then the insurance kicks in...

But pity the poor fool who doesn't have enough extra cash to put into the HSA or who can't even put enough away to cover the amount until the deductible.



I read this and I think...

1. this program is only for young healthy folks who put money into the HSA faithfully.
2. for rich folks
3. for people who want to drive themselves apeshit dealing with the pricing of healthcare.


Now this entire program is designed to make the consumer more responsible for their healthcare costs and to "save money" since people will be paying for it, but I think...

1. Individuals will find that doctor's and hospitals won't be cutting them the deals that they give to the big insurance providers.
2. That the paperwork and the hidden costs will become overwhelming
3. That they may actually end up not getting important tests or treatments because they just don't have the cash...

So am I wrong?

Correct me please!!! I want to make sure I understand this...

[Atman]

1. They benefit Bush's Base; the monied and the corporations.

That's all you really need to know.

If Bush proposes it, it won't benefit anyone but his contributors, supporters and the top 1%.

[jackster]

23. AMEN - more money for the bankers, mutual fund mangers, stockbrokers, etc

n/t

[Vincardog]

2. You are correct except that

There is no insurance.
the insurance NEVER kicks in

[bleedingheart]

5. well there is insurance but it is designed to never be used...

the perfect recipe....you pay for insurance but never spend enough to reach the deductible...

[bunkerbuster1]

3. it is a pathetic diversion

designed to make Chimpy seem like he maybe kinda-sorta gives a shit about healthcare costs.

It solves absolutely nothing--it creates nothing (HSAs already exist)--it's crap.

And if Democrats don't kick the living shit out of this, and move forward with a unified approach to providing universal healthcare coverage, they deserve to lose. this issue is a huge winner for us, and it will kill the Reeps, if only we take this ball and run with it.

[Midlodemocrat]

4. I think they are a good thing.

Money is deducted from your paycheck pre-tax and can be used on things like braces, etc.,

You, the owner of the account, saves money because your money is being withheld without being taxed and remains that way if you use it according to the specifics of the plan.

YMMV.

[papau]

15. You describe a FSA - this is an HSA - similar but different. In any

case you are out of luck if your hit by a typical hospitalization. You're either broke, busted, or sick and perhaps dying.

But it does cut down on what your company needs to pay for your health insurance.

And I guess that is a good thing!

:-)

[bleedingheart]

17. I already do that with my flexible spending account...

but the HSA rolls from year to year...which is different and good

However I am not keen on doing without good insurance...with asthma and other health issues...I would be financially strapped...

[Midlodemocrat]

28. We are fortunate to have really great insurance

Both my husband and I have coverage from our employers. I don't pay a dime for mine, and we pay about $200 a month for his.

His includes vision and orthodontics, which with three kids, has come in really handy.

[benddem]

19. Yeah

and when you are just able to put food on the table it will be just great to find the kind of money to put in your health savings account. It is just as stupid as privatising social security and this ridiculous medicare part D.

[Hong Kong Cavalier]

21. I didn't save any money with my HSA.

How about $130 a month for medicine?
When you're already strapped for cash (like I am) and can't put more than $25-50 a month into your HSA
with such a high deductible, I'm paying waaaay more than I used to for my health insurance.
Not to mention that my premiums went up for this crap.

I didn't save any money last year. In fact, I had to spend over $400 of my own money
becuase my HSA screwed up and didn't get the account up and running in time.
And I can't afford to put any more than $50 a month into it. I simply can't.

With the sheer number of people who are literally living from paycheck to paycheck, to expect them to put
more money away on top of what they're already spending for health insurance makes people simply
not go to the doctor as often. And preventive care is much less costly than critical care.

No thank you. This is simply another excuse to put the burden of health insurance on the people, and drive
up the profits of the industry.

[northzax]

6. well, there are two ways of thinking about it

one is that, yes. the other is that why wouldn't employers be able to contribute, if you pick a lower deductible insurance? I don't need my zero-deductible insurance, but I have no other option, and it costs my employer $400/month. I would be happy to drop to a $200/month plan with a higher deductible and split the difference with my employer, they put enough to cover the deductible (about $100/month) into my HSA and keep the difference. Saves them money, and I can roll over the HSA until I need something. Based on my routine expenditures, I'd be saving about $1000/year in my HSA. plus interest. that's not bad.

[shoelace414]

8. that would also take healthy people out of insurance plans

which would make insurance plans for sicker people (like those with diabeties) much more expensive.

[northzax]

12. why would it make much of a difference for a diabetic on the plan?

you still have a $1200 annual deductible, and an account with $1200 in it. and your employer still saves the $100/month. So everyone is still in the same shape, right? Yes, I would have more money at the end of the year than the diabetic, but now I have, in essence, less. The year I fall off my bike, or break my arm skiing, I break even again. Many people already have the option of paying less for insurance through their employers, my friend has a $500 annual deductible but it saves her $40 in monthly premiums for insurance at work. She could pay that extra $40/month for a better plan, but she gambles that, on an average year, she won't hit $500 in deductibles. When I was self employed, I carried a $2500 deductible (I called it 'hit by a bus insurance') for less than $90/month. I don't have a choice of plans at work, and I don't pay anything out of pocket (my employer pays 100% of the premium and I have no co-pays) they do this in order to ease the burden on people who need chronic care of some sort. It's wasted money on me.

[shoelace414]

22. insurance is just insurance

Everyone pays and when one or two take the hit, then the ones that aren't using it end up paying for the ones that do use it. If the healthier people stay away from the "better" plans, then more people in the "better plan" will be using the plan, and it will cost more because there are not enough healthy people to even out the sicker ones.

[northzax]

24. but you aren't getting my point

Let me try again.

Jane and Bob both work at XCorp. Right now, XCorp offers a PPO that costs the company $400/month per employee but has no annual deductible (only small co-pays) Jane goes to the Dr. once a year, the Gyno every year and the dentist twice a year, but has no chronic conditions requiring constant care at this time. Bob is a diabetic, visits his Dr. twice a year and buys insulin every month. XCorp now offers them both a different plan. They can get the same PPO, but with a $1200/year deductible. This would cost XCorp $250/month in premiums for each. So to sweeten the pot, the company will contribute $100/month to an HSA for each of them. Both will still use the same amount of health care, and it will cost them the same amount of money, but it will save XCorp $50/month for each of them. Jane gets a 'healthy bonus' of whatever she doesn't spend in health care over the year that rolls over to next year. Bob is in the exact same situation as he was before.

[redwitch]

25. self employed here

where do I fit in?

[northzax]

26. same as now

sorta. You can either purchase a more expensive, low or zero deductible plan, or purchase a less expensive plan and put the difference in an HSA. If you could save $100/monthby buying a plan with a $1200 deductible, and could put that $100, tax free, into an interest bearing roll-over HSA, you win, right? and you can decide how much to put in. Say you want to gamble, you put $50 month into the HSA and don't spend it all, you have cheaper insurance, with less risk of getting burned on the deductible. The beauty of the plan is, for every year you don't spend it all, you have more moeny next year. and insurance gets more expensive as you get older, right? you can afford a higher deductible over time, because your cushion keeps growing. it's your choice how much to put aside to cover the risk of you spending the deductible.

Everyone is happy, except the insurance company flunkies. Doctors like it because you pay them for the small stuff, and they don't have to fight insurance companies for reimbursement for everything. You like it because you can go anywhere for care that you want, since you have tax-free money to spend where you want. insurance companies like it because they have fewer processing costs for smaller charges, which means less overhead. the Banks are happy because it creates thousands of new accounts, most of which will accumulate money over time.

you could even have a HSA checking account, if you used the service a lot (like a diabetic) the people who bill medicare now might simply bill your HSA. less paperwork all around.

[shoelace414]

7. Repubs think if

people paid more for their healthcare, they woud price shop and prices would come down.

It's a nice theroy but in the real world people will die. and not of cancer, but of pneumonia or other very treatable diseases.

[Fredda Weinberg]

9. If you change jobs, you lose it e/m

[bleedingheart]

18. are you sure? That alone makes it awful...if it is true.

[JohnnyRingo]

10. It gives the hospitals and doctors a convenient place to go

to collect their money.
They could use it to screen new patients for eligibility to pay, since it's not a private account.

Imagine sitting in the emergency room until they access your 'health savings account" info.
Well to do Americans will have no trouble because they'll use it to shelter some of their savings from taxes, but who among us have hundreds of dollars to put away each month to pay for that unforseen future sprained ankle?

This sounds like a Republican wet dream.

[suffragette]

11. Great article in the New Yorker called

"THE MORAL-HAZARD MYTH
The bad idea behind our failed health-care system."
by MALCOLM GLADWELL



It explains what is behind HSAs.

One point from the article:
http://www.newyorker.com/fact/content/articles/050829fa_fact

“The main effect of putting more of it on the consumer is to reduce the social redistributive element of insurance,” the Stanford economist Victor Fuchs says. Health Savings Accounts are not a variant of universal health care. In their governing assumptions, they are the antithesis of universal health care.

It is absolutely the opposite direction we should be taking.

[waiting for hope]

13. That about sums it up...

I spoke to an insurance agent the other day and he said that the top insurance agent in my state has sold a grand total of 12....and he said that (in reference to your number 2 2. That the paperwork and the hidden costs will become overwhelming) Doctors are not going to want to buy into accepting this type of plan because of all of the hassles, trying to figure out who owes what and then trying to get money from those who didn't pay enough...it smells a lot like his SS plan...

[Cleita]

14. No you are not wrong. It's a big crock of you-know-what.

Also, besides saving money, you still have to pay the insurance premium. This is simply a repackaging of catastrophic insurance coverage, which already exists. If it was a good idea that addressed accessiblity to health care, there wouldn't be 40% of Americans that are uninsured or underinsured today.

[SoCalDem]

16. It's all about peeling away the healthy,. young folks

and leaving the sickest/oldest people to fend for themselves until medicare kicks in for them. If you are 45 with a chronic illness, you might as well just plan on dying young.

It's to pave the way for employers to say.. "Hey, just like we dropped pensions in favor of 401-ks, we no longer "need" to provide insurance for the employees..we can just pocket all that money we were paying for it, and still pay them shit"..

The great 'yooniter' strikes again...

[TechBear_Seattle]

20. Speaking from a background in the finance sector

I'm just a programmer, but I've worked at a brokerage firm for almost ten years; you can't help but to pick things up :think: So please, remember that I am NOT a broker and I am NOT offering financial advice.

"Savings account" is a misnomer. In reality, personal medical accounts operate almost exactly like an traditional individual retirement account (IRA.) If you have medical expenses not covered by existing insurance, you may withdraw money you need from the account without the usual penalty. Federal law sets a maximum amount you may put in to an IRA without paying taxes; money put in to a medical account is deducted from your annual limit. If you have a standard IRA and a medical account, the combined amount you put in both is the maximum limit.

They are best for people like me, who have standard insurance with routine care and prescriptions but don't have much coverage for major medical or chronic care. They are also allowing smaller businesses to provide some medical coverage to their employees: the company sets up a 401(k) style medical account, then offers a less expensive, less comprehensive insurance package with a higher deductible. The medical account can be used to cover the out-of-pocket deductible and major medical. Medical accounts can also be used to cover items not covered by insurance such as cosmetic surgery and alternatives to traditional medicine.

They are NOT suited to people with no insurance. They are not an insurance alternative, and anyone who markets them as such is is bordering on fraudulent claims.

[SmokingJacket]

27. Insurance companies are getting rid of their individual policies.

I only have one now because my state made it illegal to cut them off from people. Apparently in other states it's very difficult to buy one.

Oh, and by the way? It sucks. We pay an OUTRAGEOUS amount of money for our high deductible insurance, which so far, we've never actually used. We're healthy, and I'm grateful, but it's painful to pay so much $$ and know we'll never see it again unless, god forbid, we rack up 10K in medical bills. But at least we won't lose the house, if that happens.

We're obsessive savers so we have enough already to cover our expenses until the deductible kicks in. But two things: one, we're really lucky, really healthy people. If we had health problems that recurred year after year, we wouldn't be able to save all that money.

And two: having to pay for everything out of your own pocket makes you skimp on preventive medical care. I can't get my husband to get a physical, because it's a "waste of money." He wouldn't feel that way if it were covered.