Interesting story on Universal Health Savings Accounts and how it might be what Obama really wants, he just might now know it.

The time has come to propose an expansion of HSA and make it the universal foundation of American healthcare. Universal HSA should come with a mandatory major medical indemnity and prescription plan. These will be the same plans offered to Federal and private-sector employees through their employers. These are also known as ERISA plans (Employee Retirement Income and Security Act) which national employers choose in order to avoid compliance issues in the 50 individual States. Any funds contributed to the HSA after the payment of the indemnity premium will be saved for future needs be it co-pays, co-insurance or what the accountholder deems necessary. The savings accumulated may be left to account holders heirs without estate taxes.

In talking to people “in the know” around Washington we’ve come to find out that the new Democratic government isn’t going to be going after Health Savings Accounts any time soon. Why? For one thing they are gaining popularity each and every day. For another, universal health care isn’t working.

To much fanfare from both right and left in 2006, Massachusetts became the first state in the nation to require all residents to buy health insurance. A new state health insurance clearinghouse was created, with taxpayers subsidizing those who couldn’t afford to buy coverage. Then Gov. Mitt Romney, a Republican, promised that “every uninsured citizen in Massachusetts will soon have affordable health insurance.” Yet just two years later, Romney’s much-heralded “solution” — touted by many as the model for a national program — has become an embarrassing flop.

Instead of making health insurance more affordable, this program has made it more expensive. The law to cover everyone has made up costing everyone an extra 56 percent, but that’s not the worst of it.

Small businesses with more than 10 employees were required to provide health insurance or pay an extra fee to subsidize uninsured low-income residents, yet the overall costs of the program increased more than $400 million — 85 percent higher than original projections. To make up the difference, payments to health care providers were slashed, so many doctors and dentists in Massachusetts began refusing to take on new patients. In the state with the highest physician/patient ratio in the nation, some people now have to wait more than a year for a simple physical exam.

This is clearly not what anyone had in mind and should be a pretty strong indicator to the Obama administration that universal health care has a long, long way to go before it ever works in this country. For now, we’ll take our HSAs.

Here’s some more speculation about what the future holds for Health Savings Accounts under President Obama. Experts seem split as it will all come down to what is considered “meaningful coverage”.

Much will depend on how Obama’s plan for health-care reform pans out, experts say.

Under Obama’s health plan, medium and large employers would be required either to provide a health benefit or pay a fee.

Some industry players say the so-called “play or pay” mandate could lead more employers to offer HSAs-qualified plans as a money-saving option. However, that will depend on the criteria the plans will need to meet to be considered “meaningful coverage,” according to Bakich. (Obama’s camp has yet to define what this means).

The thing is Obama wants everyone with employer based coverage to keep it, so there is no way that those accounts are going away. If other businesses realize what those businesses are saving, the HSA industry should only grow. That’s the idea at least.