High Deductible Health Plans

In a recent article, The Washington Post describes the growing value & popularity of the HSA:

High-deductible health plans and the health savings accounts (HSAs) that link to them are becoming a familiar fixture on the insurance landscape, even though they get mixed reviews from many consumers and health policy experts.

Rising costs make the plans attractive to employers because they are cheaper than comprehensive coverage. And the new health care overhaul makes only minor adjustments to the plans. But some supporters worry that bigger changes might be in store.

Plans with high deductibles — ones that have annual deductibles of at least $1,200 for individuals or $2,400 for families if they’re linked to an HSA, for example — are a key element in “consumer-driven health care,” an approach based on the idea that people will make smarter, less wasteful health care decisions if they have a bigger financial stake in their own care. The plans started going mainstream after a 2003 law created HSAs that link to some high-deductible plans. The accounts allow people to put money aside tax-free to cover deductibles and other medical expenses. Employers and employees alike can contribute to the accounts, but the money belongs to the workers, who can take it with them if they leave their jobs. (Money deposited in a flexible spending account, in contrast, disappears at year’s end if it’s not used.)



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