It is the Patriotic Thing to Do

America is the only country in the industrialized world that does not guarantee health care to all of its citizens. Despite the shocking expense of our system, America trails nearly the whole industrialized world when it comes to the health of its citizens.

•    In 2000, the U.S. ranked 37th in health system performance among 191 World Health Organization member states.

•    In 2006, the U.S. had the second highest infant mortality rate in the industrialized world.

•    In 2007 life expectancy at birth in the U.S. ranked 45th.
These are sobering statistics for a country that prides itself on equality and justice for all.

Health Savings Accounts (HSAs)—touted by some—undermine the current insurance system and will not provide the answers we need.  Insurance works by spreading risk over a large pool of people.  Individuals with chronic illnesses—diabetes, seizure disorders, some cancers, heart disease, asthma, etc.—face high health care costs.  Only by spreading the cost over many people can treatment for these diseases be afforded.  Insurance also protects against unforeseen events such as car accidents, stroke, and premature birth.  Spreading risk over many people allows us to handle these unexpected events without being bankrupted.

HSAs remove individuals from the risk pool by setting up private accounts where more of each person’s costs and health risks are carried by that person. Even though HSAs must be coupled with a catastrophic care plan, patients are required to pay more for their medical care than before. People with chronic illness and those who face unexpectedly high health care costs are hit hardest. The money in their HSAs is quickly depleted and they face high out-of-pocket costs on a yearly basis. This further weakens the community network on which society rests.

In short, HSAs benefit those who need the least assistance. They act as a tax shelter for the wealthy, who can deposit money and use it, tax-free, years later. Employers can benefit from shifting more costs onto their employees. And banking and investment firms earn higher profits from HSA’s high administrative fees and from holding the money deposited in the HSAs.

Use of valuable preventive services is also discouraged by HSAs. People limit beneficial care when they are required to pay out-of-pocket. One recent study found that 35% of individuals in HSAs delayed or avoided health services, compared to just 17% in traditional plans. The NPA believes that use of preventive services should be encouraged, not discouraged.

Most critically, HSAs will have little or no impact on health care costs.  Recent estimates are that 20% of the population uses 80% of the health care resources.  Though HSAs would likely make these people pay more for their health care, it is unlikely to discourage their use of care or significantly impact costs. Once people reach their out-of-pocket maximum or limit, the plan must pay for all of their care. We need to look at ways to make sure that health care dollars are spent rationally; it is neither rational nor moral to discourage patients from necessary care.