Interesting op-ed from Zac Byer in the Daily Pennsylvanian on health care. We think at the end of this paragraph he really makes a strong point about what a lot of people are missing about other health care plans.

Americans will also benefit from the flexibility of a tax-advantaged Health Savings Account.

These accounts would allow consumers to avoid taxes on income set aside for medical expenses. Unused funds would roll over and accumulate at the end of the year. Tailoring these savings to different preferences is crucial and something that simply cannot be achieved under a government-mandated system. Again, the individual is empowered.

Ultimately, no discussion on health care is complete without addressing the issue of rising costs. One glance at current government entitlement programs shows us that merely handing over more control to bureaucrats will only serve to accelerate spiraling costs.

That’s what it all comes down to really, costs. People want the right to choose the health plan that suits them and nobody can do that better than themselves. People know what they want to pay, they don’t want to be told what they have to pay.

We posted earlier about John McCain’s health care plan and how they tie into health savings accounts. We thought it’d be a good idea to show you the break down of what he proposes, thankfully Newsweek already did it.

McCain’s plan would:

• Give a health insurance tax credit of up to $5,000 for couples and families and $2,500 for individuals. Those who choose to buy insurance on their own would be able to use the credit to pay for their health coverage, with payment going directly from the government to the insurance company. Nobody would be required to buy insurance for themselves or their children, and employers large or small would not be required to offer health insurance as a benefit.
• Tax the value of employer-provided health benefits. Employees would pay federal income taxes (but not Social Security or Medicare payroll taxes) on the value of those benefits. The tax credit would offset those taxes. Companies would not be taxed.
• Expand health savings accounts so that any money left over from the tax credit could be put into such an account, where it could be used for approved medical expenses.
• Allow the sale and purchase of insurance across state lines. No federal standards would be imposed, and insurance companies would not be required to cover preexisting conditions.
• Expand high-risk pools that exist in many states to cover those who have been denied coverage or have high-cost health issues. Some financial assistance would be given to low-income people in such pools.

The American Chronicle wonders why McCain doesn’t do a good job defending his health care plan. With Health Savings Accounts as the centerpiece of his plan, you could see why this would interest us.

But consumers of health care don´t think about that when they undergo a treatment or service. They just assume insurance will cover everything, so they don´t concern themselves with what it´s going to cost. Then, if the insurer rejects a claim, they find themselves in a financial crisis.

McCain´s plan flips this around. Instead of using a tax incentive to encourage employer-provided health coverage, it shifts the tax incentive to individuals – giving them the deduction so they can buy their own coverage. That way they don´t depend on their employer, and they´re more involved in the process, which should serve as an incentive for them to pay more attention to the costs.

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Business Week did a special report on Health Savings Accounts this week titled “Health Savings Accounts: More Time, Less Money“. The story takes an even handed look at the advantages and disadvantages of an HSA and how it can work for an individula or a business.

HSAs can be a smart savings tool, particularly for small businesses and self-employed workers who need tax shelters and lower out-of-pocket expenses. That’s why Vijay Goel, 31, of Los Angeles opened up an HSA to cut his health-care costs for his startup, HealthShoppr.com, which helps consumers shop for health-care services online.

Goel says his COBRA insurance, which would have extended coverage for 18 months after he left his job as a McKinsey consultant, cost $450 a month—and it covered only him, not his wife. Instead, he’s spending $200 per month for a plan with a $3,000 deductible that insures both of them. “We’ve gotten our premium way down, which allows us to be protected without wasting tons of money that would go straight to the insurance company,” he says. In addition, since HSA contributions can pay for dental and optometry services, the Goels have eliminated the need to pay for those two areas separately.

One of the main concerns employees have with High Deductible Health Plans and Health Savings Accounts are “What if something happens today and I can’t cover the deductible?” Well, one company has figured out a way. Interest fee cash advances on their Health Savings Account. This is genius.

The company in 2006 devised a way to help employees pay unexpected medical bills by advancing cash interest-free from future paychecks. The money would otherwise have been deducted from their paychecks during the course of the year and deposited into individual health savings accounts. The service helped calm employees’ fears of not being able to pay for the high deductible, which is $2,500 for individuals and $5,000 for families in one of the plans the company offers.

“The No. 1 concern we heard from our associates was, ‘I don’t have $2,500 January 1st if I’m hit by a bus,’ ” said Andy Greenberg, principal of HR programs. “They were worried by that. This takes the worry out of having an unpredictable health care event.”

This is the type of company I’d like to work for.

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Comerica Bank is the latest financial institution to add an HSA program. Our only question is, what took them so long?

Comerica Bank’s business customers can now offer their employees an affordable option for managing their health care expenses with Comerica HealthReserve, a health savings account (HSA). Comerica HealthReserve is also available to individuals with high-deductible health insurance coverage.

“With healthcare costs continuing to outpace inflation, the Comerica HealthReserve account enables us to offer our business customers a chance to lower their expenses while helping their employees,” said Cassandra McKinney, director of Retail Product and Sales Management for Comerica Bank.

Coloradoan: HSAs a favorable way to set aside funds

Question: I’m looking for a way to cover my family’s medical expenses and save taxes at the same time. Can a health savings account accomplish this?

A: Given the ever-escalating cost of providing employee health care benefits, a health savings account (HSA) can be a more cost-effective method of providing these benefits.

If there was one thing about Health Savings Accounts that we could change it would be the fact the restrictions. HSAs are good for everyone and as John C. Goodman says in this article “Ideally, people should be able to combine a health savings account with any plan, regardless of any deductible or co-payments.”

John C. Goodman, known as “the father of health savings accounts” for having helped to create the HSA, has been meeting with government and business leaders this year to support the adoption of what he calls “Universal Health Savings Accounts.”

This type of consumer-driven health plan would replace all other such plans, such as Flexible Spending Accounts, Health Savings Accounts and Health Reimbursement Arrangements, he said.

“The motivation is the same — to give the consumer more control and replace all such consumer driven health plans with just a single account: the Universal Health Savings Account,” said Goodman, who is president and CEO of the National Center for Policy Analysis.

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Survey shows that Health Savings Account users are split on the presidential candidates.

Republican candidate Sen. John McCain drew 52% of support among participants with family health insurance coverage, according to a survey of 4,930 HSA users conducted by Information Strategies Inc.

Sen. Barack Obama, the Democratic candidate, was favored by 54% of participants with individual coverage, the survey found.

I’m sorry, but that doesn’t really tell us anything. Did they neglect to ask why? 57% said they opened their own HSA, what percentage of them went each way?

I found this letter to the editor in the River Falls Journal. So often Health Savings Accounts are thought to be only for the rich, but this woman shows that real people use them too.

The off-handed comment made by the candidate running for Assembly insisting that health savings accounts are tax shelters for the rich really got my blood boiling.

I’m self-employed and I’ve purchased my own health insurance for the past nine years. It’s not cheap, but it’s necessary.

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