CAHI Maps Out Obstacles To Spread Of HSAs

Health savings account supporters who want to add HSAs to Medicaid plans and state employee health plans face many challenges.[@@]

Researchers at the Council for Affordable Health Insurance, Alexandria, Va., a nonprofit group backed by insurers, brokers and actuaries, give that assessment in a review of some of the structural challenges that remain in the HSA market.

The CAHI researchers, Victoria Craig Bunce and Merrill Matthews, note that Kay Cole James, director of the U.S. Office of Personnel Management, added HSAs to the federal employee health plan in 2004.

“The question now is will the states do the same,” the researchers write.

Alaska, Iowa, Minnesota, Montana and Texas already are looking into the possibility of adding HSAs, “but some states are facing significant opposition, especially from unions,” the researchers write.

The researchers also analyze the idea of using HSAs to hold down Medicaid costs.

Florida and Iowa already have started testing the idea of offering Medicaid HSAs, the researchers write.

“Would the approach be a radical departure from traditional Medicaid?” the researchers write. “Yes, but Medicaid needs radical change.”

Medicaid administrators who want to add HSAs will have to deal with questions such as the fate of HSA balances accumulated by Medicaid recipients who leave Medicaid and ways to combine the incentives HSAs give patients to control costs with traditional Medicaid cost-control features, such as preferred drug lists.