Monday, March 14, 2005
HSAs given a bad rap by big Kansas insurance companies
[Phyllis Jacobs Griekspoor, "Insurers' hikes slow," The Wichita Eagle, 13 March 2005.]
What a difference a couple of days make. After an excellent article from Dan Voorhis on the entry of financial institutions into the health savings account market last Thursday, this Phyllis Griekspoor article from Sunday is enough to leave a person speechless:
One product that does not seem to be catching on in the Wichita area is Health Savings Accounts, which pair a high-deductible insurance policy with a tax-free savings account. Bailey said Blue Cross is offering HSA products but has seen almost no interest in them.
"One reason is that people looking for an affordable product are not likely to have the money to fund a savings account or to pay a huge deductible," he said. "There are traditional products out there that offer pretty good premium rates. The premium differentials are just not enough to convince someone to make a move."
Clothier agreed.
He said most people can't afford a health savings account.
"The reality is all an HSA does is transfer the responsibility for payment to the employee, who really can't afford it," he said. "I don't think they are any solution to the health care crisis."
Not only are the claims outrageous, but no attempt is made to balance the views of major insurance companies, who obviously have nothing to gain from customers choosing a less-expensive coverage option.
Despite the views of these firms, the reality is that interest in HSAs has never been higher and the savings available are significant.
"This market is an emerging market off to a fast start," says America's Health Insurance Plans President Karen Ignani. In fact, a recent Hewitt Associates survey of more than 500 employers found that 57 percent are considering HSAs.
As Robert Harbison of Intrust Bank stated in the Voorhis article following the announcement of their HSA offering, “We're getting a lot of interest.”
The popularity of HSAs begins with a less-costly high-deductible health insurance policy that functions as true insurance rather than pre-paid health care. According to eHealthInsurance, 89 percent of HSA-eligible plan purchasers paid $200 or less per person per month, and 56 percent of HSA-eligible plan purchasers paid $100 or less per month.
Add to this a savings account that builds tax-free and follows individuals wherever they go, and the combination is quite powerful. A Watson Wyatt survey of nearly 1,000 individuals with health insurance found that 66 percent of respondents like the idea of having control of HSA funds, even after leaving their employer.
Traditional insurers may wish to keep this genie in the bottle, but the rest of the state is moving ahead no matter how much bad press they try to give HSAs. "This is not a little blip,” says William Short of UMB Bank, “this is the future of health care."
[Devon Herrick, "Health Savings Accounts: The Future Of Health Care For Kansans," The Flint Hills Center, 14 February 2005.]
[Phyllis Jacobs Griekspoor, "Insurers' hikes slow," The Wichita Eagle, 13 March 2005.]
What a difference a couple of days make. After an excellent article from Dan Voorhis on the entry of financial institutions into the health savings account market last Thursday, this Phyllis Griekspoor article from Sunday is enough to leave a person speechless:
One product that does not seem to be catching on in the Wichita area is Health Savings Accounts, which pair a high-deductible insurance policy with a tax-free savings account. Bailey said Blue Cross is offering HSA products but has seen almost no interest in them.
"One reason is that people looking for an affordable product are not likely to have the money to fund a savings account or to pay a huge deductible," he said. "There are traditional products out there that offer pretty good premium rates. The premium differentials are just not enough to convince someone to make a move."
Clothier agreed.
He said most people can't afford a health savings account.
"The reality is all an HSA does is transfer the responsibility for payment to the employee, who really can't afford it," he said. "I don't think they are any solution to the health care crisis."
Not only are the claims outrageous, but no attempt is made to balance the views of major insurance companies, who obviously have nothing to gain from customers choosing a less-expensive coverage option.
Despite the views of these firms, the reality is that interest in HSAs has never been higher and the savings available are significant.
"This market is an emerging market off to a fast start," says America's Health Insurance Plans President Karen Ignani. In fact, a recent Hewitt Associates survey of more than 500 employers found that 57 percent are considering HSAs.
As Robert Harbison of Intrust Bank stated in the Voorhis article following the announcement of their HSA offering, “We're getting a lot of interest.”
The popularity of HSAs begins with a less-costly high-deductible health insurance policy that functions as true insurance rather than pre-paid health care. According to eHealthInsurance, 89 percent of HSA-eligible plan purchasers paid $200 or less per person per month, and 56 percent of HSA-eligible plan purchasers paid $100 or less per month.
Add to this a savings account that builds tax-free and follows individuals wherever they go, and the combination is quite powerful. A Watson Wyatt survey of nearly 1,000 individuals with health insurance found that 66 percent of respondents like the idea of having control of HSA funds, even after leaving their employer.
Traditional insurers may wish to keep this genie in the bottle, but the rest of the state is moving ahead no matter how much bad press they try to give HSAs. "This is not a little blip,” says William Short of UMB Bank, “this is the future of health care."
[Devon Herrick, "Health Savings Accounts: The Future Of Health Care For Kansans," The Flint Hills Center, 14 February 2005.]
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