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Life Health > Health Insurance > Life Insurance Strategies

Hearing Witnesses Critique HSA Approach

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A House Ways and Means Committee subcommittee presented several critics of high-deductible health plans and account-based plans Wednesday at a hearing.

Rep. Pete Stark, D- Calif., chairman of the Ways and Means Committee’s Health Subcommittee, noted in the hearing announcement that he believes health savings accounts and high deductible plans “are a flawed policy approach to making health care more affordable.”

“Instead of using the tax code to encourage people to purchase coverage that may be woefully inadequate, we should focus on providing comprehensive health care coverage to those most in need in the most cost-efficient way possible,” Stark argued.

One hearing witness, Wayne Sensor, chief executive of Alegent Health, Omaha, Neb., a hospital company, spoke in defense of HSAs.

Alegent Health has set up its own, voluntary HSA program, and the company’s health care costs have increased just 5.1% per year over the first 2 program years, compared with industry trends in the 10% to 15% range, Sensor testified.

“Our employees are healthier,” Sensor added, reporting that more than 500 employees have completed smoking-cessation programs that weight-loss program participants have lost a total of about 13,000 pounds

The other witnesses, including representatives from the U.S. Government Accountability Office and the Urban Institute, Washington, said the tax breaks offered to encourage use of HSAs appear to go mainly to help higher income taxpayers and do not appear to do much to increase access to health coverage.

Another witness, Michael Chernew, a health care policy expert at the Harvard University medical school, said consumers rarely have access to enough relevant information to make good health care purchasing decisions.

One think tank study has shown that, when cost-sharing increased, “patients reduced utilization of services deemed clinically appropriate by the same amount as they reduced the use of services deemed clinically inappropriate,” Chernew testified.

Doubling the co-payment for medication to $20, to $10, decreased use of blood pressure drugs by 10% and use of anti-diabetes drugs by 23%, Chernew said.

Chernew did not discuss efforts by HSA and HRA program managers to encourage use of preventive care by offering “first dollar” coverage for routine diabetes care, routine hypertension care and other preventive care.

Chernew noted that he and colleagues are preparing to publish a study that will show how increases in patient cost sharing affect HEDIS health care quality indicators.


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