The GOP’s Clean Bills of Health Savings Modest improvements in HSAs deserve votes in the Senate.
https://www.wsj.com/articles/the-gops-clean-bills-of-health-savings-1532895810
The Senate plans to stay in Washington for August this year, and here’s an idea to keep busy: Pass some House health-care reforms that are modest improvements even Democrats should like.
The House last week passed a set of bills that included changes in Health Savings Accounts, or HSAs, which are tax preferred accounts that allow individuals to save for future medical expenses. More than 20 million people have HSAs, which Congress created in 2003, but arbitrary restrictions cramp enrollment.
For one, a person has to be on a plan with a high deductible. A plan can’t cover certain services below the deductible like telemedicine or diabetic test strips, which can save costs over time. HSA money also can’t buy over-the-counter medicine, which is often cheaper than prescription drugs.
HSAs tend to be concentrated in the employer-sponsored or large group market, where insurance is likely to be available and comprehensive. But in the individual market less than 30% of ObamaCare plans are compatible with a health-savings account, according to an analysis from health consultant Roy Ramthun. The rest have deductibles too low (13.7%) or out-of-pocket maximums too high (56.6%) to comport with restrictions.
The House bills would allow more flexibility in HSA-plan benefits, raise contribution limits, among other tweaks like allowing over-the-counter drug purchases. If the House wanted to be more ambitious, it would allow any plan below, say, 70% actuarial value to be paired with an HSA.
The House last week also voted to delay ObamaCare’s health-insurance tax and moved to repeal the medical device tax. It appears the House will wait until the fall to consider delaying again the pain of another ObamaCare levy—the 40% “Cadillac tax” on expensive plans. Legislation to kill it has some 300 co-sponsors, and the question is what’s precluding that bill from becoming law.
One reason is criticism from some on the right who like the Cadillac tax as a way to reduce the tax advantage for employer-sponsored insurance over individual insurance. But it isn’t progress to compound one bad policy (a tax carve out) with another (an excise tax). Why should politicians decide how much coverage is too generous? The better policy would be to reduce the tax exclusion for employer plans, which some Members of the Freedom Caucus blocked as part of ObamaCare repeal.
Many of these health-savings bills are bipartisan, though Senate prospects are uncertain. Democrats think high-deductible insurance is too stingy, which is ironic since ObamaCare has driven Americans into high-deductible insurance as other options become less affordable. Even Senator Elizabeth Warren wants to kill the medical device tax, since Massachusetts is home to device makers. And any Democrat who wants lower premiums next year should support a delay in the direct tax on premiums that insurers pass along to consumers.
Then again, Democrats may want to prolong premium pain so Republicans are blamed in the fall. The GOP should nonetheless press ahead with floor votes in August to show who supports better insurance options.
Comments are closed.
