HSA Success Story

[mykidslovedogs]

JS Online: For deputies, being in charge works

This is the kind of thing that I have been trying to get across to many on this forum. If the employer can save enough $$ on premiums by switching to an HSA, oftentimes, they are willing to contribute large amounts of $$ towards the HSA accounts, which gives the insured the power of control over medical expenses in the "middle" that are neither preventive nor catastrophic. What the employee doesn't spend in their account grows year after year, instead of just throwing that money away on premiums. If we can get enough employers to look into HSAs, perhaps retirees will be more likely to be able to have benefits upon retirement.

[traco95]

I have had a HSA for several years. It is the answer or at least one of the answers for reirees health care. I live in what used to be considered a Union controlled area. The previous employers were coal mines, steel mills and railroads. The employees were used to having everything paid for throught their health coverage. This resulted in unecessary visits to the emergency rooms etc. The public has to be educated that it is better to pay for the service when needed rather than through a larger monthly premium. The basic premium for the insurance coverage is minor for an HSA when compared to full coverage, it is usually at most half. The insurance industry and the politicians have done a poor job explaining hsa accounts and their benefits.

[mykidslovedogs]

You are right...we spend a LOT of time on education, and people can't believe the benefits once they truly understand how it works.

[Freein05]

Do insurance companies also have limitations on preexisting conditions in HSA coverage?

[FIRE'd@51]

Originally Posted by Freein05

Do insurance companies also have limitations on preexisting conditions in HSA coverage?

Yes. I agree that the HSA is a great concept. When they came out I wanted to switch my existing high deductible policy to an HSA. My agent told me my exisiting policy wasn't eligible for an HSA, and I would need to be re-underwritten for a new HSA-eligible policy. Do to a pre-exisiting condition, I couldn't qualify for the new HSA-eligible policy.

[Freein05]

Originally Posted by FIRE'd@51

Yes. I agree that the HSA is a great concept. When they came out I wanted to switch my existing high deductible policy to an HSA. My agent told me my exisiting policy wasn't eligible for an HSA, and I would need to be re-underwritten for a new HSA-eligible policy. Do to a pre-exisiting condition, I couldn't qualify for the new HSA-eligible policy.

Than I would have to say an HSA program is not a solution to our health care problems.

[FIRE'd@51]

Originally Posted by Freein05

Than I would have to say an HSA program is not a solution to our health care problems.

I would agree - that's why I said I thought it was a great concept, not a great solution. It still suffers from many of the underwriting problems that individual insurance suffers from. If those could be fixed, I think an HSA-type structure might work fine for most people. When I was looking at pricing of individual policies, I found that often the difference in annual premium for a low-deductible vs a high-deductible policy was often nearly equal to the difference in deductibles. Presumably, that is related to the cost of processing all the little claims.

[mykidslovedogs]

HSAs can be offered on a guaranteed basis, through group policies and state risk pools, so they already are becoming a wonderful solution to making premiums more affordable...especially if the employer has enough $$ left over from premium savings to fund the deductibles in an HSA account for employees....

But as per some of my earlier suggestions, I am wondering why something like a nationalized catastrophic plan, compatible with HSAs, couldn't be implemented, where employer's would be allowed to make tax-deductible contributions to an account (like an HSA or HRA account) that people could use to pay for their deductibles or premiums.

Anyways...it's just a thought. Thought something like that might be a less costly (to the general public) solution than just handing out a free, low deductible plan to everyone.

[FIRE'd@51]

MKLD,

Would it be possible to do something along the lines of what you are suggesting with one gigantic national risk pool with everyone (other than the folks on Medicare) forced to participate (young, old, sick, healthy)? That would do away with the adverse selection and pre-existing condition problems. Furthermore, the policies would be tied to the individual, so they could be completely portable. No one would ever lose his insurance so long as he kept paying the premiums. This would get the employer out of the picture, other than possibly contributing to the HSA account toward the deductible, or raising salaries so employees could buy the catastrophic policies. But the insurance component would not be directly provided by the employer. Throw in some tax credits (or some type of government subsidy) to take care of low income folks. And as you have pointed out, the medical providers would never be on the hook for more than the deductible, since presumably everyone would be covered.

[mykidslovedogs]

Originally Posted by FIRE'd@51

MKLD,

Would it be possible to do something along the lines of what you are suggesting with one gigantic national risk pool with everyone (other than the folks on Medicare) forced to participate (young, old, sick, healthy)? That would do away with the adverse selection and pre-existing condition problems. Furthermore, the policies would be tied to the individual, so they could be completely portable. No one would ever lose his insurance so long as he kept paying the premiums. This would get the employer out of the picture, other than possibly contributing to the HSA account toward the deductible, or raising salaries so employees could buy the catastrophic policies. But the insurance component would not be directly provided by the employer. Throw in some tax credits (or some type of government subsidy) to take care of low income folks. And as you have pointed out, the medical providers would never be on the hook for more than the deductible, since presumably everyone would be covered.

You got it! That's exactly what I had in mind! I guess I must not be very good at getting my ideas across... But yes! I'm thinking we could somehow afford to at least provide a nationalized castrophic plan and then BAN employers from offering insurance, but then ALLOW them to put aside money as a BENEFIT in an HRA for employees to use for deductibles and/or premiums. Unlike HSAs, hRas can be used to pay for premiums! Any $$ people don't use can be theirs to take from one job to the next, like 401K money....this will be the incentive for people to make wise decisions about their healthcare, and healthcare usage.

However, I still think that the plan should be managed and administrated by private carriers, kind of like Part D and Medicare Advantage plans are, and I also think that people should have the CHOICE to buy up OR down for a lower or additional, premium, if they wish, and the buyup plans could be medically underwritten as per the insurance carrier's discretion. I also think that people should have to pay at least SOME of the premium, perhaps on a sliding scale, but the BASIC plan should be guaranteed.

The big trick is going to be trying to figure out how to force people to participate. It could potentially be an IRS pre-requisite that employers can only HIRE people if they can show proof that they have the BASIC plan design or proof that they have signed up at the time of employment....kind of like we have to show proof of our IDs to turn in with our W2 forms....and then premiums could be paid like through a mandatory payroll tax. For unemployed and low income folks, they probably wouldn't have to pay any premiums anyways, so it wouldn't really matter if they signed up or not...if they choose not to sign up, it's their loss.

[maddythebeagle]

Originally Posted by mykidslovedogs

I guess I must not be very good at getting my ideas across...

That is the understatement of the century....only took 20 pages of gibber jabber in the Obama thread to come to that conclusion...

[Freein05]

I think is has possibilities but I will be on Medicare of dead by the time something is done about health care in this country.

[OKLibrarian]

Originally Posted by Freein05

I think is has possibilities but I will be on Medicare of dead by the time something is done about health care in this country.

I'm a bit more optimistic about the health care issue being resolved by the time we FIRE, but I'm also 30 with a target retirement age of 50. Never ceases to amaze me that we can cure dread diseases, invent nuclear weapons/power, put people on the moon, and launch the Internet, but we can't figure out a way to provide health care that will bankrupt neither the people nor the government.

[mykidslovedogs]

Originally Posted by Freein05

I think is has possibilities but I will be on Medicare of dead by the time something is done about health care in this country.

I think if a democratic president is elected, we will see drastic changes over the next 8 years....people will LOVE the changes, because everyone will have access to care, and then 10 or 20 years down the road, the democrats will blame the republicans for the long wait times and crappy care that people are recieving, we'll go full circle, end up back to square one, and probably implement catastrophic coverage at that time.

[Freein05]

Originally Posted by mykidslovedogs

I think if a democratic president is elected, we will see drastic changes over the next 8 years....people will LOVE the changes, because everyone will have access to care, and then 10 or 20 years down the road, the democrats will blame the republicans for the long wait times and crappy care that people are recieving, we'll go full circle, end up back to square one, and probably implement catastrophic coverage at that time.

And the Republicans have done such a good job of controlling and fixing health care. They had almost five years of total control of the government. All we got form them was a Trillion dollar plus war with a bill our great grand children will be paying for.

[mykidslovedogs]

Originally Posted by Freein05

And the Republicans have done such a good job of controlling and fixing health care. They had almost five years of total control of the government. All we got form them was a Trillion dollar plus war with a bill our great grand children will be paying for.

It took way more than five years to break the system, and it will take many more years than that to fix it! Healthcare costs have a long history and there are many many reasons why it has gotten out of control, but IMO, the primary reason we are in this boat in the first place is 1.) because wage controls, way back when, resulted in healthcare becoming an employee benefit instead of personal responsibility which further resulted in a divorce between the actual cost of care the people who recieve it, and 2.) because the poorly designed Medicare and Medicaid programs have led to huge cost shifting to the private sector......(IMO, short sighted democraticly inspired legislation resulting in serious problems down the line.)

[ziggy29]

Originally Posted by Freein05

And the Republicans have done such a good job of controlling and fixing health care. They had almost five years of total control of the government. All we got form them was a Trillion dollar plus war with a bill our great grand children will be paying for.

Both parties suck.

Partisan politics suck.

As long as people think the "right" solution has to come from one party or the other, the chances of reaching consensus on reasonable health care reform are greatly diminished. Too many people on Side A won't accept anything that comes from Side B, even if they'd support the same thing from "their" side.

Sad.