“Governments should focus on enhancing care rather than imposing burdensome requirements on providers who care for patients,” he said. Brad Wenstrup (Republican, Ohio), teaming up with progressive Oregon Democrats Count Blumenauer About the benefits expansion bill.
The proposed changes reflect the new state of health insurance for Republicans. Republicans have turned their backs on efforts to repeal Obamacare, but see the high deductible scheme as a way to increase market power within the system. They are also appealing to Democratic lawmakers such as Blumenauer as a way to make health care more affordable.
But other Democratic lawmakers, including ranking members of the Subcommittee on Revenue and Health Lloyd Doggett (D-Tex.) fears the plan will still pose financial and medical risks to low-income employees who can’t afford the deductible, resulting in them skipping medical care. .
Doggett believes the bill primarily benefits the wealthy, and that the plan includes health savings accounts with significant tax incentives, undermining the interests of the public. ing. Law for Adjustment of Medical Expenses By providing improper compensation.
“The idea is to provide tax shelters on an increasingly large scale,” Doggett told POLITICO.
The changes that pass the House would keep another advantage that Republicans support. That said, high deductible schemes are meant to keep people from getting unnecessary health care, reduce health care costs, and keep inflation under control.
Approved by the Revenue Commission to increase the number of users of the plan Mr. Wenstrap and Mr. Blumenauer’s Bill It was backed by a strong bipartisan vote in June to allow plans to cover chronic care services before patients reach deductibles.
committee too Approved law Led by two Republicans Michelle Steele California and Adrian Smith a Nebraska legislator and two Democrats, Susie Lee Nevada and Brad Schneider This allows plans to deductible the costs of telemedicine.
The bill will be put to a vote in the entire House of Representatives after Congress returns from its August recess.
pros and cons
Despite skewed votes, tensions boil over the revenue bill, with Wenstrup calling Democratic opponents’ claims that wealthy people are using health savings accounts as secondary retirement benefits “absurd.” criticized.
Blumenauer acknowledged that the plan has established a well-established position in the insurance market and argued that the bill would help increase preventive care.
“More and more employers are choosing to offer this type of coverage,” he said. “We should not turn our backs on expanding opportunities for prevention.”
For frugal people, health insurance with high deductibles has a lot to offer. This plan has a low monthly premium and provides full coverage for preventative care such as annual checkups, vaccinations, mammograms and colonoscopies at no out-of-pocket costs.
The downside is that participants in the plan pay for sick visits, medicines, surgeries, and other treatments up to a minimum deductible of $1,500 for individuals and $3,000 for families, as negotiated by the insurance company. It is a must. In some cases, the deductible amount is much higher.
To cover these costs, plan members can fund a medical savings account with tax-exempt income when used to cover medical expenses. He can invest up to $3,850 annually for individuals and $7,750 for families. Many employers also allow registrants to save an additional $3,050 from taxes each year in a limited purpose flexible spending account to cover dental and vision costs. All of these figures are adjusted annually for inflation.
Plan participants cannot invest in broader healthcare flexible spending accounts that cover medical expenses, but participants can use funds from their medical savings accounts to do so. Most of his FSA funds will expire at the end of the year if unused. HSA funds have no expiration date and allow holders to invest in stock and bond funds.
When an employee turns 65, the HSA becomes a sort of supercharged 401(k). Because you can withdraw your funds for any reason, and like a 401(k), withdrawals are subject to income tax. Meanwhile, the owner can still cover medical expenses. No tax.
Those who fund tax-friendly accounts well each year and at the same time maintain good health enough to continue to invest that money can grow big nest eggs.
Proponents argue that the proposed changes would expand access to care and provide potential cost savings by encouraging preventive care. Skeptics argue that by not providing adequate coverage, it puts low-income patients at risk and makes them vulnerable to high bills.
The American Hospital Association has expressed concern about the plan, arguing that it shifts costs onto patients and, if patients are unable to pay, onto hospitals. Insurer Robbie AHIP spokesman David Allen countered that insurers negotiate lower rates with health care providers, such as hospitals, to protect consumers from high costs.
Cheryl Fish-Percham, director of private press for left-wing consumer health advocacy group Families USA, said the cost of medical care also discourages going to the doctor and can put patients’ health at risk. said there is. Watch people avoid care because they think they can’t afford it. ”
But employers say they have additional reasons to support the bill being considered by the House of Representatives to expand the services that patients are fully covered before they hit the deductible.
“When it comes to low-cost, high-quality services — high-value services, we want to maximize utilization,” said James Gelfand, member of the ERISA Industrial Committee, which represents the interests of large employers. said the chief.
Tax cuts and health outcomes
A quarter of employers offer a high-deductible plan with HSA, up from 10 percent in 2009, and the percentage of workers using that plan is increasing. doubled in the last 10 yearsaccording to the Health Care Research Group KFF, the survey included a wide range of large and medium-sized employers.
An estimate focused on large employers by consulting firm WTW found that 86% offered plans with high deductibles, 80% of which had an HSA.
“We knew the market could go electrified. said Joel White, chairman of the Affordable Care Council, who helped draft the language to create a modernized, deductible health plan. acted when he was an aide to the Republican Ways and Means Committee.
He cites Indiana as an example of what states should do, giving cash incentives to people who get preventative care, such as participation in smoking cessation programs and annual checkups.
Plans with higher deductibles are becoming more popular as many insurance companies raise their premiums. Those on higher priced plans can switch to a higher deductible and hopefully don’t get sick.
“We continue to offer premiums because employers want lower premiums as an option,” said Adam Beck, senior vice president of commercial employers and product policy at insurance lobby group AHIP. .
Studies have shown that very few participants are able to take full advantage of the tax benefits. More than half are registered According to one analysis, they hadn’t contributed to their medical savings account for over a year. Welfare Institute While the average HSA account balance was around $4,000, more than a third of registrants ended the year with less than $500, according to the survey.
There is evidence that there is a huge disparity.
Research from 2015 High-income participants were found to establish and fully fund an HSA “at least” four times more often than low-income participants.and 2020 survey Black, Hispanic, and low-income beneficiaries were found to be significantly less likely to use HSA than white and high-income individuals.
But White argues that there is little evidence of disparities in health outcomes as a result, and low-income people don’t use HSAs as often because many don’t have private health insurance. It has said. The Medicaid plan does not provide him with HSA.
But he called for further study of the results and suggested that other types of plans be allowed to have associated medical savings accounts. That would require parliamentary action.
Meanwhile, Frank Wallum, of the Duke Margolis Center for Health Policy, has a study that shows worse diabetes outcomes among low-income individuals enrolled in high-deductible plans, regardless of whether they have a health savings account. pointed out. His study of his HSA high deductible plan for diabetics found an increase in complications.
“I believe that highly deductible health care plans are potentially harmful to critical populations, especially those with low incomes and high prevalence … and the health of high incomes in general. We don’t think it’s detrimental to outcomes,” Waram said.
Mr. White countered that during the period of Mr. Warham’s study, participants were not able to fully fund the HSA.
