GUEST COLUMN: Health Saving Accounts are not the answer

Thursday, October 30, 2008 | 10:00 a.m. CDT; updated 11:17 a.m. CDT, Tuesday, May 4, 2010

Dale Vaslow's recent flurry of health care articles raises so many questions that it's hard to know where to start.

First of all, the Health Saving Accounts prized by Mr. Vaslow are not the answer. While they may initially look appealing, HSAs are like the Halloween candy with a razor blade in the middle.

HSAs are not health insurance. They are a tax-free savings investment program — available only to those who have bought a High Deductible Health Plan (HDHP — often called "catastrophic coverage"). The theory is that what one saves by buying this cheaper "catastrophic coverage" can be put into a Health Savings Account.

In a 2006 report written for the Commonwealth Fund by Sara Collins she discovers many problems with HSAs, not the least of which is finding a provider willing to take the chance that you will be able to pay for the services. People with a High Deductible Health Plan often go into debt and are "far more likely to delay or avoid getting needed care or to skip medications because of the costs." HSAs discourage preventive care and do nothing to control high prices.

Mr. Vaslow claims, "If you lose your job, your HSA stays with you, allowing you to pay health expenses and continue payment of premiums." But how many who are out of work can continue to pay for out-of-pocket care, the HDHP premiums and still invest in their HSA? A study by David Lowsky and Stefanos Zenois at Stanford University reaches a startling conclusion: "HSAs require upwards of 20 years for most households before they can be relied upon with great confidence to cover all future health care costs." In these unpredictable economic times with rising health care costs, HSAs are inadequate and risky.

Small businessman R. Sawyer Spoon, a member of the Business Coalition for Single Payer Healthcare, says of our market-based financing, "Health insurers' success depends upon charging for goods and services that are not delivered. The more they can charge and the less they can deliver, the better off they are. They are unbelievably well-off precisely because they charge so much and deliver so little." Health care will never be free, but our "free-market system" takes 31 cents out of every health care dollar for profit, advertising and bureaucracy.

We need to replace this outrageously expensive fragmented chaos with one that works: a single-payer system. In a single-payer plan, all residents make up the risk pool and pay into one pot of money.  Health providers remain in private practice but give medical care with the guarantee of fee-for-service payment. With single-payer, administrative costs, as with Medicare, can be trimmed to as low as 3 percent. To pay for this comprehensive care, Physicians for a National Health Program propose that businesses pay a 7 percent payroll tax — much less than they currently pay for health benefits. Meanwhile, consumers would pay an additional 2 percent income tax.

Under this not-for-profit system, no one would ever pay premiums, co-pays or deductibles and everything would be covered. Single-payer is also "simple-payer." Wouldn't it be a relief to never see another medical bill in your mailbox?

The newly awarded Nobel Laureate, Paul Krugman, an economist with a heart (now isn't that unique), wrote in an article in 2005 that, according to a 2003 Pew poll, said 72 percent of Americans "favored government-guaranteed health insurance for all." Physicians for a National Health Program reports that percentage has risen and most physicians would support a single-payer system over the current structure. Krugman advises, "Let's ignore those who believe that private medical accounts — basically tax shelters for the healthy and wealthy — can solve our health care problems through the magic of the marketplace."

Tuesday's election challenges us to change our tremendously expensive yet faltering and insecure health care situation. Even though Barack Obama has not progressed to fully support a single-payer system, he does insist that preexisting conditions must be covered. Overall, Obama's ideas come much closer than John McCain's to meeting the benchmarks of universality, affordability, choice of provider and quality, comprehensive coverage. In contrast, McCain's lack of required mandates results in less coverage. McCain has voted against expanding health care to our children and supports vouchers, Health Saving Accounts and private "high-risk" (and high-cost) pools for people with pre-existing conditions.

Where is — to use Mr. Vaslow's expression — "freedom of choice" if our choice is to be uninsured or to agonize over which of the 1,500 insurance corporation plans, or HSAs, and IRAs we should gamble on? Why jump through all these hoops for something we don't trust or like?

Last of all, we already pay enough — we're just not getting what we pay for. Each of us needs the emotional and financial security of comprehensive health coverage and we can't do it alone. Let's demand this from our elected officials.

Vicki Neill and Mary Hussmann are retired registered nurses and members of Mid-Missourians for Universal, Single-Payer Health Care.

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John Schultz November 2, 2008 | 12:31 a.m.

HSAs coupled with a high-deductible (and not catastrophic as claimed) plan can save the consumer money. My employer offers both an HSA/CHDP plan and a PPO plan. The CDHP plan's premiums are almost $2000 less than the PPO plan. My employer also puts half of my deductible into my HSA.

Regarding the claims that single-payer health care can be paid for by increased payroll taxes, what incentive will the government have to keep healthcare costs down when they can just raise payroll taxes again? What are the current administrative costs for Medicare?

(Report Comment)
Ayn Rand November 2, 2008 | 5:03 p.m.

Who's ready for a health insurance system that requires these kind of trade-offs?

Australia: No residency for boy with Down syndrome

SYDNEY, Australia (AP) -- Thirteen-year-old Lukas Moeller has Down syndrome. His father is a doctor who came to Australia from Germany to help fill a shortage of physicians in rural communities.

But now Australia has rejected Dr. Bernhard Moeller's application for residency, saying Lukas does not meet the "health requirement" and would pose a burden on taxpayers for his medical care, education and other services. . . .

In its decision, the Department of Immigration and Citizenship cited Lukas' "existing medical condition," saying it was "likely to result in a significant and ongoing cost to the Australian community," according to a statement Thursday.

"This is not discrimination. A disability in itself is not grounds for failing the health requirement - it is a question of the cost implications to the community," the statement said. . . .

Australia's immigration department said it appreciates Moeller's contribution to the community but said it must follow the relevant laws in considering residency applications.

"If we did not have a health requirement, the costs to the community and health system would not be sustainable," the statement said.

(Report Comment)

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