Editore"s Note
Tilting at Windmills

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January 23, 2006
By: Kevin Drum

HEALTH SAVINGS ACCOUNTS....President Bush's Bold Proposal for 2006 is apparently going to be Health Savings Accounts, a half-baked pseudo-solution to the healthcare crisis that sounds intriguing primarily to people who are young and healthy and therefore don't think they're going to need much healthcare. That's just the right target audience for a healthcare plan, isn't it?

Technically, the idea behind HSAs is that you put, say, $2,000 in a tax-free account and then buy a health plan that doesn't pay anything until your expenses exceed $2,000. You pay for your normal healthcare expenses by drawing money out of the HSA, and if there's any left over at the end of the year you get to keep it. Ezra has more about it here.

However, for the quick and dirty explanation behind HSAs, here is Peter Gosselin in the LA Times this morning:

Most conservatives including those in the administration believe that the root cause of most problems with the nation's healthcare system is that most Americans are over-insured.

The debate over HSAs is going to get mighty wonky over the next few months, but always keep this explanation in mind as you're trying to make sense of the charges and countercharges. The fundamental idea behind HSAs is not to provide better healthcare, it's to provide less healthcare. Conservatives want you to think twice before spending a hundred bucks for your regular pap smear.

I'm probably going to write enough about HSAs over the next few months to make everyone scream for mercy, especially since I assume the White House will decline to publish an actual plan, leaving us instead to speculate wildly about what they really have in mind. So I'm going to wrap up this post right here. Just remember: if you think more risk, more complexity, and less healthcare are the answer, HSAs are for you. The rest of us will keep pushing for something that actually makes sense.

Kevin Drum 12:13 PM Permalink | Trackbacks | Comments (108)

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Comments

What I don't understand is that my current employer already provides a health care reimbursement account. I may contribute to this account before taxes and withdraw the money to pay for qualifying healthcare costs.

The only catch is that this account must be cleared out every year - no money may be carried over.

So how is Bush's plan giving me something I don't already have?

Posted by: Tripp on January 23, 2006 at 12:17 PM | PERMALINK

Kevin: I'm probably going to write enough about HSAs over the next few months to make everyone scream for mercy ...

If you write one half as much about global warming, which threatens to destroy human civilization within our lifetimes, as you do about HSAs, I will jump for joy.

Posted by: SecularAnimist on January 23, 2006 at 12:17 PM | PERMALINK

Most conservatives including those in the administration believe that the root cause of most problems with the nation's healthcare system is that most Americans are over-insured.

That's the most ridiculous thing I've ever heard. What is it now? Over forty million with no insurance whatsoever--and increasing every year. Millions of children with no access to any kind of health care. What a great system.

Well, there's something to the idea--the less healthcare you provide, the less likely it is that the doctor will screw something up and kill the patient. This 'less is more' approach should get wider exposure when Time and Newsweek run competing cover stories under the headline Too much Health Care can Kill YOU???"

Posted by: Pale Rider on January 23, 2006 at 12:20 PM | PERMALINK

Kevin,

I'd love to have some concrete talking points about how this will affect real people (like what happens when one problem exhausts your HSA, and then you get another problem) that could be used in letters to the editor in local papers right after the SOTU address. It'd be great to snuff this one out before it even gets off the ground.

Thanks

Posted by: KathyP on January 23, 2006 at 12:20 PM | PERMALINK

The fundamental idea behind HSAs is not to provide better healthcare, it's to provide less healthcare.

Completely wrong Kevin. Conservatives just want you to spend smarter on health care so that you spend money on things that work rather than waste money on things that don't work. Right now people are depending on big government programs like Medicare and Medicaid or depending on employers to finance their health care. This fosters a culture of dependency on others to pay for your health care rather than for you to pay it yourself.

Creating health care accounts will end that culture of dependency. This is no different than welfare reform which helped people start working rather than depend on others. A good side effect of the accounts is businesses can invest more money to help our economy and therefore hire more workers which will help workers much more in the long run.

Posted by: Al on January 23, 2006 at 12:22 PM | PERMALINK

What about folks who don't have $2000 each sitting around in January to put into an account that sits around collecting 4% interest, while their credit card bill charges 18%? Sounds like a loser to this wonk.

Posted by: MobiusKlein on January 23, 2006 at 12:22 PM | PERMALINK

Good luck with this comments string. Considering the obvious cost of adding another, taxpayer wide, $2,000 per year federal income tax deduction, I wonder if any Democrat will have the foresight to simply propose expanding Medicare by whatever the same cost would be.

For example, if this plan would cost, say $X billion in tax revenue per year, you should be able to pencil out offering Medicare to everyone over, say, 47 years of age, for the same $X billion.

Of course, cue those who believe that the massive buying power of millions of americans spending thier $2K will affect the entire health care industry to the good, but talk about a speculative benefit!

By contrast, expanding Medicare would actually result in fewer uninsured citizens.

But, that might illustrate the benefits of universal single payer coverage.

Can't have that.

Posted by: hank on January 23, 2006 at 12:22 PM | PERMALINK

Conservatives just want you to spend smarter on health care so that you spend money on things that work rather than waste money on things that don't work.

And just how is the average patient supposed to know what "works?" Isn't that why we seek the expertise of a doctor??

Posted by: Ben on January 23, 2006 at 12:26 PM | PERMALINK

Only a liberal would think that the power that the HSAs give to a person to take more responsibility for his or her health care is not a desirable goal.

In my view more free market in the health care industry will do wonders, not just for the efficiency of the system, but also for the health of the american people who have been ill-served by the 50 years of liberal indoctrination to look for someone else so solve each and everone of their problems, no matter how trivial.

Posted by: tbrosz on January 23, 2006 at 12:29 PM | PERMALINK

Oh, and I would not put it past the administration to propose something that already exists as a "new" bold proposal.

This was the guy, you will recall, who trotted out a hot dog vendor as an argument against the estate tax.

Posted by: hank on January 23, 2006 at 12:30 PM | PERMALINK

fake al and fake tbrosz--

Wow. Lamer than usual.

Posted by: Pale Rider on January 23, 2006 at 12:32 PM | PERMALINK

Here's an idea. Think outside the box for a second.

At my place of work, if I'm sick for two or more days straight, I need to get a doctor's note for those days, or risk being punished/fired.

I wonder how many businesses do this, and how much strain this is putting on the health care system. I think a study of this would be interesting, and might help a whole lot.

Posted by: Karmakin on January 23, 2006 at 12:32 PM | PERMALINK

Apparently, some of you guys are under the impression that this isn't current law. HSAs are available right now. It is also the case that you have to buy high deductible insurance to get the HSAs so most people don't have them since they have traditional insurance.

I believe it would be more correct to say that people who support High deductible insurance/HSAs think that the best way to improve healthcare is for people to have incentives to stay healthy, eat right, and exercise. You know, more European(esp. in the eat right department). Obviously, since old people are already overweight and have smoked most of their lives, then you got to start young and keep them healthy.

This is only a part of the solution as there is nothing that will change the fact that old people haven't taken care of themselves that well.

When I go back to business school, I will likely get this as I will be able to put $5,200 in the account while in school. You don't have to take the money out after you've spent money on health insurance. You can keep it in the account and earn interest taxfree until you want it.

Posted by: Chad on January 23, 2006 at 12:36 PM | PERMALINK

The idea of allowing people over, say, 45 to buy into (or even be covered by) Medicare is a great idea. And I mean Medicare as it currently exists. Combine this with coverage for children that continues after they are 18, and we could have everyone insured in a couple of decades.

The problem is not people using health care excessively, it is people getting too little for the money that is spent because of administrative costs and poor allocation of resources. Study after study has shown this. My 93 year old Mother spent 10 hours in Emergency Friday afternoon/evening with possible pneumonia before being admitted because Emergency was so overwhelmed. (Mother is ok.) Too many people postpone care and then go to Emergency Rooms. And too many doctors outside of the Kaiser system spend too much time on paperwork.

Keep it up. You are doing a great service.

Posted by: Mimikatz on January 23, 2006 at 12:37 PM | PERMALINK

I'm excited that Kevin is going to get into the minutae of HSAs.

HSAs won't fix the fact that Medicare is going to be a huge expense.

Posted by: Chad on January 23, 2006 at 12:39 PM | PERMALINK

what "works?" Isn't that why we seek the expertise of a doctor??

Posted by: Ben on January 23, 2006 at 12:26 PM | PERMALINK

Sure. But if you were footing the tab. You would dump a doctor that seemed to be over prescribing.

HSA's usually don't force you to burn what you set aside for the year. That's the diff from health reimbursement.

And if you think the deal sucks, you can always buy the insurance instead if you are with a large employer with multiple options..

Posted by: McA on January 23, 2006 at 12:39 PM | PERMALINK

So why would a universal health care plan work?

Posted by: McA on January 23, 2006 at 12:40 PM | PERMALINK

I don't have money. Period. I owe my soul and my firstborn child to the private college I currently attend...I have no health insurance because I cannot afford the monthly premiums. And even if I could, the six companies (so far) I've contacted won't accept me because of my preexisting condition. Soon, IF I make it onto Medicare, I will be receiving a new kidney since both of mine are failing - another caveat being if any of my family qualify as matches. Otherwise, it's a years-long wait as I while away my time on dialysis. I am 27 years old.

So when I hear some people blithely talk about a "culture of dependency" or "the problem is over-insurance" - I just have to laugh. How can you possibly understand that there's even a problem if you haven't LIVED it in the first place? I don't have $2000 to put in some account. I don't even have $200 - that's how much I spend every month on blood tests that tell me things I already know. But I have to document my medical condition to get on Medicare.

I'd love to feel empowered - I'd love to pay for my own health care, be responsible for my own situation. THE MONEY ISN'T THERE. And that's just how it is, for so many people: the ones that don't have a voice, or time to spend debating the welfare system and the merits of pulling up by one's bootstraps, or a computer to express their thoughts and share their own hopes, fears, and aspirations.

Don't paint me, and the other 45 million Americans wihtout basic health care, with the same broad brush.

Posted by: Mary Eliz on January 23, 2006 at 12:41 PM | PERMALINK

Al sez Conservatives just want you to spend smarter on health care so that you spend money on things that work rather than waste money on things that don't work.

Well Dr. Al, could you please list the things that do not work so we won't waste our money. Thanks.

Posted by: cq on January 23, 2006 at 12:41 PM | PERMALINK

I can't wait to see Al and tbrosz making all these intelligent decisions about their private health care when they are in their '70s and '80s, let alone their '90s. Really. We just need a simpler system. A little choice between plans is ok, but taking responsibility for your own HEALTH (desirable) is not the same thing as taking control of your health care decisions.

Posted by: Mimikatz on January 23, 2006 at 12:41 PM | PERMALINK

The differences between this and an FSA include:

1. All the years' money in an FSA is available day-one. IE, if you're scheduled to contribute 2000 over the year from your paycheck, you can withdraw 2000 on January 2nd for a surgery or whatnot. An HSA is like a bank account - it can be overdrawn and only has what you've contributed so far (I overdrew mine twice by accident last year - 20 bucks each time in fees).

2. HSA rolls over year-to-year.

That's pretty much it. Some other minor differences of course.

As usual, nobody's willing to talk about the real problem here - the elderly and other stay-at-homers are the only group consuming a lot of health care, because they're the only ones who have the time to sit in doctors' offices all day. All this fiddling rests on the absolutely false idea that people with _jobs_ can be incented to consume less health-care. Going to the doctor is such a pain in the ass that those of us who are employed are _already_ consuming the bare minimum that we _need_.

Posted by: M1EK on January 23, 2006 at 12:45 PM | PERMALINK

Koreyel's prediction:

Health Care policy will tread water until the baby boomers start to physically crumble.
Once their hearts, kidneys, and livers start to go south things are going to get interesting.

Until then?

Superficial republican pallatives (ie. Pigs at the trough).


Posted by: koreyel on January 23, 2006 at 12:46 PM | PERMALINK

fake tbrosz is so boring.

fake al is at least entertainingly-robotic.

Posted by: Donkey_Punch on January 23, 2006 at 12:50 PM | PERMALINK
What about folks who don't have $2000 each sitting around in January to put into an account that sits around collecting 4% interest, while their credit card bill charges 18%?

It wouldn't necessarily be a horrible policy to allow anyone to save a certain amount tax free in an HSA annually, to fully fund that maximum amount from public funds for the poorest Americans, with a sliding scale based on income up to some point where it would be completely reliant on personal savings.

Though that is only part of any real health care plan; you still need to deal with the people who aren't young and healthy when the plan starts, for one thing.

Posted by: cmdicely on January 23, 2006 at 12:52 PM | PERMALINK

We have these where I work as well.

Personally I don't think the tax deduction is worth tying up my savings in yet another use specific account I would have to keep track of and pay fees on. It would be far worse for a lower income person for whom the taxes avoided and thier overall savings rate would most likely be a lot less.

It's just more welfare for the upper middle and above classes. They get a 30% rebate on healthcare, and the percentage as well as ones ability to take advantage of it drops with income.

I wish all these deductions would just go away.

Posted by: jefff on January 23, 2006 at 12:54 PM | PERMALINK
So why would a universal health care plan work?

Because universal health care plans have widely demonstrated throughout the real world that they do work.

Might as well ask "Why would gravity work?"

Posted by: cmdicely on January 23, 2006 at 12:54 PM | PERMALINK

I assume the White House will decline to publish an actual plan, leaving us instead to speculate wildly about what they really have in mind.
As last year's Social Security "proposal" and Supreme Court nomination process demonstrate, Republicans think that it is unfair to ask for details, there should just be an up or up vote.

Posted by: Bud on January 23, 2006 at 12:55 PM | PERMALINK

What, exactly, is the Free Marketeer rationale for this? A government program to "encourage" individuals to spend less on health care? That hardly sounds like taking personal responsibility to me.

I get my health care through the local Chamber of Commerce. Since I'm a contract employee I pay for it myself. $8400 a year for my family of four, and that's the cheap plan. No actuarial tables here. No discount for stellar health records. Just $8400. In 2000 I paid $5600 for the same thing. It would be nice if I could write off all of that ever-increasing necessary expense. $2000 doesn't help much.

And if I don't spend some part of my $2000 I get to keep it? Whoopee. At least that's better than the employer HSA scams I've brushed up against in the past.

Posted by: shrimpop on January 23, 2006 at 12:56 PM | PERMALINK

Let's end the culture of dependency! Everybody making less than $10,000 a year should just write out a $2000 check! Problem solved!

Young people are already saving money so that they can buy a house, buy a car, start a family, put their kids through college, and retire. Does anybody think that they are going to save more money for HSAs? Or, which one of the above should they stop saving money for?

Posted by: reino on January 23, 2006 at 12:57 PM | PERMALINK

"Personally I don't think the tax deduction is worth tying up my savings in yet another use specific account I would have to keep track of and pay fees on. It would be far worse for a lower income person for whom the taxes avoided and thier overall savings rate would most likely be a lot less."

Actually, if you are young or healthy and think joining would be profitable, you're probable better off contributing to these plans than you are to a 401k.

Of course, if you do, you really want to make a conscience effort to live healthy and not get sick.

Posted by: Chad on January 23, 2006 at 1:02 PM | PERMALINK

Kevin, you were one of the first 12 months ago with "there is no crisis" for Bush's SS privatetize plan.

You explained his falsehoods very well. Please continue to do the same about HSA's.

BTW, I predict his HSA plan will fall faster than SS last year...after Iraq, Katrina and now Medicare D, Bush's incompentance quotient is sky high. Who is going to believe that he can do anything correctly?

Posted by: Big Red on January 23, 2006 at 1:02 PM | PERMALINK

Typical conservative talking point:

In my view more free market in the health care industry will do wonders, not just for the efficiency of the system, but also for the health of the american people...

Um, that sounds all magical nice in a fairy land of imagination, but how the hell does it actually work? You people never come out with concrete proposals until everyone grudgingly agrees to let you try you way, and then it turns out to be a bass-ackwards mess that falls flat on its face, crushing a segment of the population with it.

Oh, and a bullet-point for you to learn: HSAs are not privatization. They aren't. We already have a private health care system. You can get insurance through work or wherever, as long as you can show your employer you're covered somehow. You can see whoever your plan covers. It's all private. Unless you fall in certain categories where no one will help, then you can turn to the government and maybe they'll be able to keep you alive and productive.

How the heck do you privatize an already privatized system? Simple. Consign those who need care most to a death sentence.

Posted by: Adam Piontek on January 23, 2006 at 1:14 PM | PERMALINK

Republicans are generally out of touch with what Americans expect from their daily lives. I don't want to negotiate an "electricity contract" every day with one of a dozen "electricity providers" willing tto cover my needs. I want to walk into my apartment, flip the switch, and have the lights go on. I don't want to call up a local reservoir and negotiate for several gallons of water each day. I want to turn the faucet and know that I can wash my dishes or take a shower and not wonder whether the "terms of service" are constantly changing from month to month or day to day.

Similarly, I don't expect my medical treatment to turn into a set of extensive contract negotiations. If I get sick or injured, I want to go see a doctor, get treated, and know that the issues are covered. I'm willing to pay a fixed monthly fee for this coverage, plus maybe a token fixed fee when I patronize individual services. Do Republicans think that Americans want to turn every purchase of our daily necessities into a protracted contract negotiation?

Posted by: Constantine on January 23, 2006 at 1:14 PM | PERMALINK

BTW, I predict his HSA plan will fall faster than SS last year...

Yep, me too. Another "bold proposal" that thankfully won't ever be enacted--the prescription drug plan is like a giant warning sign to everyone re the consequences of such "bold" ideas.

Posted by: Ringo on January 23, 2006 at 1:15 PM | PERMALINK

Hear, hear. Universal health care DOES work. Points to consider:

1. At the moment the most expensive part of US demographics is already paid for by Medicare. Adding the other 60% may double or triple the cost at most, which will still be a tiny fraction of what the feds, state, local, and business currently spend on healthcare.

2. It is NOT in anyone's best interest to be disincented to use health care - this is not like buying groceries or auto parts (at least, not yet.) People should be encouraged to see their doctor immediately and not put off care until expesive procedures are required. To the poster above that said 'I cant find time to see my doctor as it is' I would argue that if you could drop by a clinic at 8pm for free you might reconsider having them look at that freckle that wasn't there before, and save the rest of us the cost of your radiation therapy, and perhaps your own life to boot.

3. Whenever universal health care is discussed, one always hears a chorus of 'The US has the most advanced care in the world, do you want ruin that!' and similar talking points. Yes it's true, currently a huge industry is supported by our health care costs. Yes, they often have the incentive to create new procedures, but just as often they don't! Why can't I, as part of my insurance plan, get an MRI to check for cancer at the age of 25? 30? 35? Do we not have this technology? Would this not save quite a bit of money, to find out about the tumor earlier?


Posted by: smoof on January 23, 2006 at 1:18 PM | PERMALINK

McA wrote:
So why would a universal health care plan work?

One good indicator is that it's already working in dozens of industrialized countries, most of which score higher than the US on the WHO ranking.

Posted by: Ben C on January 23, 2006 at 1:19 PM | PERMALINK

These would be quite the bonus for the banks who get in on it as well-- here's the fee schedule for the specialized bank that holds my HSA:

http://www.hsabank.com/accountholders/rates_fees.asp

I didn't go so far as to calculate how high the balance has to be for the interest to exceed the basic monthly fee, but it's certainly a whole lot higher than my initial $1200 balance.

Posted by: latts on January 23, 2006 at 1:20 PM | PERMALINK

"BTW, I predict his HSA plan will fall faster than SS last year...after Iraq, Katrina and now Medicare D, Bush's incompentance quotient is sky high. Who is going to believe that he can do anything correctly?"

Unfortunately, it will be up to the leftwing blogs to keep track of all the distortions proffered by the Bush administration and to point out all the likely bad results if the plans are put through Congress. If it wasn't for Talking Points Memo, I'm convinced Social Security would already be history. If you find any real discussion in the mainstream media of the fact that pooling risk is actually way more cost-effective than every man for himself in the health care arena, I for one will be shocked.

The MSM would rather recite each side's demagogic (and either totally dishonest or totally irrelevant) talking points, and handicap the horse race in getting this program passed.

Posted by: brewmn on January 23, 2006 at 1:23 PM | PERMALINK

Isn't this Social Security personal savings accounts all over again?

That's the name of the game for this administration: if it doesn't work the first 10 times, try it another 100 times.

It was their modus operandi for tax cuts, which didn't work, and it will continue to be their modus operandi for everything else from Iraq to health care.

That's faith-based over reality-based policy in a nutshell.

Those who don't learn from the history of the GOP will be doomed to repeat it.

Posted by: Advocate for God on January 23, 2006 at 1:25 PM | PERMALINK

McA is a particularly unintelligent and pestiferous troll, but he said something insightful a few comments up:

Mary Eliz: I'd love to feel empowered - I'd love to pay for my own health care, be responsible for my own situation. THE MONEY ISN'T THERE.

McA: Just don't think the money will be there under another system. At last check, lots and lots of people don't get really expensive procedures early enough to save their lives under universal health care.

I wish you luck and hope you get to a state that will cover you. And you might want to drop out of private school and switch to community college.

I believe in education but you can't use it if you don't live.

---

And there you have it in a nutshell. The conservative opinion on the issue is: Fuck You. Unlucky? Too bad. Poor? Too bad. Crawl back into your lower class hole. You do the best with what you have and if you come up short, well, Fuck You. Just don't ask me to pay a goddamn red cent.

Whatever god you may pray to, McA, He's pretty damn ashamed of you.

Oh, and the money is there under lots of other systems. And it costs less, too. Your "last check" is utterly wrong.

Posted by: S Ra on January 23, 2006 at 1:32 PM | PERMALINK

McA: "At last check, lots and lots of people don't get really expensive procedures early enough to save their lives under universal health care."

Holy unsupported assertion, McAristotle! Exactly how many people is "lots and lots of people"? Could you provide a cite, please? And, while you're at it, could you please compare that number to the number of people who fail to get expensive procedures early enough to save their lives under our own American health care system... is it more people? Less?

I'd just like to know what exactly you mean by "lots and lots of people."

Posted by: Patrick Meighan on January 23, 2006 at 1:39 PM | PERMALINK

Aflac!! :►

Posted by: Lurker42 on January 23, 2006 at 1:40 PM | PERMALINK

Shorter Bush health plan: Since so many people have been complaining that they can't afford the co-pay for their employer-provided health plan, we'll make everyone personally pay for all their health care costs!

Posted by: NotThatMo on January 23, 2006 at 1:41 PM | PERMALINK

Health savings accounts are another component of the REPUKELISCUM Attack On Middle America: Divide and conquer.

They are trying to get all our money, the REPUKELISCUM and their big business buddies. To do this, they come up with programs that get us divided into small groups that can be fleeced easily.

Health savings accounts pit you, the lone consumer, against the hospital. You have no ability to get a discount like an insurance policy, since you are all by yourself. You can't even get them on the phone.

Divide and conquer, the REPUKELISCUM plan to take all your money.

Posted by: POed Liberal on January 23, 2006 at 1:44 PM | PERMALINK

Politically, George W. Bush couldn't have possibly picked a *worse* time to roll out a new health care plan. With Medicare D a cluster-f of herculean proportions, and with every ounce of the blame resting on the Republicans' doorstep, and with it the details highlighted on the front pages of newspapers nationwide... NOW he wants to go on national television and say, "I've got a great health care idea! Trust me on this one!"

What an unrepentent, tin-eared dumbass.

Posted by: patrick Meighan on January 23, 2006 at 1:47 PM | PERMALINK

"The fundamental idea behind HSAs is not to provide better healthcare, it's to provide less healthcare. Conservatives want you to think twice before spending a hundred bucks for your regular pap smear."

Damn straight. The plan should be called self-rationing.

Or better yet, Health Segregation Accounts.

After all, that is what this will lead to: a society in which the old and sick are segregated from the young and healthy.

It's the perfect example of "I got mine, screw you!"

Posted by: Chris Andersen on January 23, 2006 at 1:51 PM | PERMALINK

How's that "ownership society" thingy working out so far?

Dow Jan 2006 less than Dow Jan 2001

Posted by: ckelly on January 23, 2006 at 1:51 PM | PERMALINK

Every single program that the REPUKELISCUM have come up with involves getting the Lone Consumer off by herself and required to negotiate with a large company for some service.

Take electricity, for example. The old model involved a powerful state commission that set rates. The commissions were very effective. They set rates low and required electicity companies to demonstrate very clearly why they needed a rate hike.

Now, we get everyone negotiating with electricity companies. People are very crappy negotiators with large companies. WE DON'T HAVE MARKET POWER, so we get taken to the cleaners, every single time.

So, whenever the REPUKELISCUM start talking about "empowering the consumer", "letting the consumer make decisions" or any other such crapola, realize that they really want to get you, the Lone Consumer, off by yourself in a corner where they can take all your money and you can do nothing about it.

Posted by: POed Liberal on January 23, 2006 at 1:52 PM | PERMALINK
Most conservatives including those in the administration believe that the root cause of most problems with the nation's healthcare system is that most Americans are over-insured.

I disagree. The most troubling commentary that I hear dribbling out the mouths of legislators (with 100% legislatively guaranteed lifelong health insurance) is the so-called "Moral Hazard" of full coverage.

The only way that same person can really think that maintaining good health is a hazard, is if a) they themselves can exersize their moral superiority by resisting the sirens call of the doctors visit, and b) they are more worried about average stock holders than average patients.

Posted by: Jon Karak on January 23, 2006 at 1:52 PM | PERMALINK

I predict his HSA plan will fall faster than SS last year...

How could it not?

Since when do Americans save for anything?
Since when do we have an economy predicated on saving?

It is ALL ABOUT spending money FASTER than you make it.
Without which... the economic treadmill you hamsters are busily spinning around in your cages would spit, shit, and stop.

Let's be serious.

Asking an American to save is like asking a republican pig to grow wings.

Ain't going to happen...

Posted by: koreyel on January 23, 2006 at 1:58 PM | PERMALINK

And also, they won't save money.

About 80% of healthcare spending is for big-ticket items, like heart bypasses and liver transplants and taking care of two-pound-preemies.

These big-ticket items are way past the deductible. So people won't comparison shop for them.

How exactly are healthcare savings accounts going to control spending when they don't even attempt to control 80% of the spending?

Posted by: theorajones on January 23, 2006 at 2:06 PM | PERMALINK

The line in Gosselin's article right after the one Kevin quoted reads: "[These conservatives] argue that insurance keeps people from feeling the sting of prices and therefore from being wise consumers."

This "wise consumer" argument is one of the central economic fallacies in the whole MSA argument. Perhaps I can price shop concerning how much a particular doctor charges for office visits.

But what if I or a family member need blood work or other lab work done? Are we supposed to price shop medical labs?

What if I need an MRI or x-ray? Am I supposed to price-shop these services?

What about emergency services? Should I phone all the ER's in the area after having a car accident, then inform the ambulance which one to take me to? And, maybe, I should price-shop ambulance services, too.

What about hospital admissions? Such admissions are directly related to what doctor I have have chosen (as doctors generally admit only at hospitals where they have privieges).

The point of this is simply to emphasize that the healthcare system as a whole contributes to costs--and that determination of many, if not most, of these costs are beyond the reasonable abilities of most consumers.

Generally, health care costs are not a matter of consumers being too lazy to make choices. Health care costs inevitable involve a combination of inability, due to factors beyond an individual's control, and lack of sufficient technical expertise to be able to choose what is the best avenue of care.

Posted by: Jim on January 23, 2006 at 2:12 PM | PERMALINK

Here's more on why the Bush health plan will be DOA.

Posted by: AvengingAngel on January 23, 2006 at 2:14 PM | PERMALINK

Actually, Kevin, this is the kind of thing you generally do well at. Its the off-the-cuff stuff that lets your internalized GOP talking points loose, but when you make the effort to think about what you are saying, you usually get it right.

So - good wonk, miserable hack.

Posted by: Mysticdog on January 23, 2006 at 2:24 PM | PERMALINK

Instead of homeowner's insurance we need to have a homeowner's savings account.

If you want a mortgage you will have to demonstrate that you've already saved the replacement cost of the house. So if your house burns down you can afford to rebuild it out of your Homeowner's savings account.

That way happy Chad, who can afford business school AND save $5200 towards future health care costs can also tuck away, what do you say, Chad, $20,000 a year so you can also buy a house without insurance?

Do you get it, Chad? Obviously anyone like you, young and healthy and rich does not have a problem affording health care.

Posted by: Tripp on January 23, 2006 at 2:31 PM | PERMALINK

Jim,

Amen. Another myth Republicans like to cite is the myth that if healthcare was 'free' Americans would swamp healthcare providers with stupid and unnecessary visits.

Even if somehow the service was free the hassle of getting time off work, driving to the provider, finding parking, and then hanging around the waiting room with other sick people is enough to make people think twice.

Offer free prostrate exams and see the men come in two, three times every day to get a finger up the butt! Yeah, sure. That is just stupid.

Posted by: Tripp on January 23, 2006 at 2:39 PM | PERMALINK

HSAs offer me a very real and viable alternative as a self employed person buying my own private health insurance.

I am a new owner of an HSA. My previous plan's annual premium was rising rapidly to the $10,000 mark. It was also a high deductible plan. My new HSA has allowed my to lower my premium by almost 3/4's or closer to $2500 per year. I and my daughter had some preexisting conditions and I was pleasantly surprised that we were accepted without any exclusionary waivers. This was after being rejected by another health insurance company for what I considered to be a relatively minor preexisting condition.

So, absent any alternatives like single payer, the high deductible, HSA account health plan provided me with a more viable and affordable plan compared with the one I previously had that did not give me any of the tax benefits.

HSA's are not a fix for our screwed up health care system with wildly escalating costs, but for me as a self employed person, it bought me some time until something better comes along.

Posted by: lou on January 23, 2006 at 2:43 PM | PERMALINK

McA--
Rich people will pay for it. It's called income taxes. And when rich people pay for it, they'll make sure that the people setting prices can negotiate. When the Democrats adopt Single Payer, they will have a reason for being other than not accepting Abramoff money.

If HSAs are associated with high deductibles, they will be political suicide. $10,000 deductibles are unacceptable to everybody.

Posted by: reino on January 23, 2006 at 2:58 PM | PERMALINK

The great part about HSA is you get 3% intrest on your money,While some big company gets to take that money and make 10-18% on it yea whoo ho what a deal.

Posted by: scott on January 23, 2006 at 2:59 PM | PERMALINK

lou,

I am not following you. Are you saying that there is an insurance component in the Health Savings Account?

Posted by: Tripp on January 23, 2006 at 3:01 PM | PERMALINK

Thank you, Tripp. I was diagnosed with pre-hypertension about three years ago. I don't know if it's better or worse, but I haven't been back since to have it checked, and I have health insurance.

If the government was providing us with fre chocolate, then I might be worried that people were running out to get too much of it. The idea that we all like to go to the doctor, undress in a cold room, get poked and prodded, admit to all of our lifestyle failings, and then be told we have to stop drinking/eating/smoking is a fucking crock.

But just you watch, the question of whether Americans consume too much health care will get major play in this debate.

Posted by: brewmn on January 23, 2006 at 3:06 PM | PERMALINK

A nice table with expenditures on healthcare for OECD countries...
http://ocde.p4.siteinternet.com/publications/doifiles/012005061T002.xls

Another nice table with life expectancy and infant mortality for OECD countries...
http://ocde.p4.siteinternet.com/publications/doifiles/012005061T003.xls

We don't seem to be doing as well as some of them damn socialist countries in terms of bang for the buck.

Posted by: cactus on January 23, 2006 at 3:11 PM | PERMALINK

Where do they live, these people proposing that I can use the money in such an account to make a rational spending decision?!

None of the doctors I have seen have a fixed "price list" that I could comparison shop. They all have complex fees that vary depending on the agreements negotiated with different insurers, and varying 'discounts' that they agree to write off from those fictional fees. I can't even get a plain answer to "how much does that cost" for any actual medical service. It's absurd to suggest that I have the power to pick between Doctor A or Doctor B based on price.

And that's not even touching on the issue of how I should be able to, when I'm trying to pick the surgeon to remove the rapidly growing and painful cancerous tumor from my body while not leaving me permanently disabled or disfigured, properly calculate whether their differing fees would be justified by their relative expertise, or which one was "overpriced." Nor would I have the option of picking the 'reasonably priced' Surgeon A and the 'reasonably priced' operating room at Hospital B, since Surgeon A doesn't work at Hospital B.

Our health-care pricing and financing system is too bizarre and byzantine for an individual to make 'rational buying decisions', even if one thought that healthcare was a place where purely economical criteria were appropriate.

Posted by: biggerbox on January 23, 2006 at 3:20 PM | PERMALINK

The optimal outcome that the market is suppose to provide in Econ 101 depends very much on there being "perfect" information. Having a monopoly on information is like having a monopoly on anything else - it allows you to get further away from the competitive outcome in a way that benefits you to the detriment of others in the market. As biggerbox and others have noted, consumers in this market do not have anything close to adequate information. Its not in the best interests of the insurance companies for the consumers to know what is going on.

Posted by: cactus on January 23, 2006 at 3:28 PM | PERMALINK

HSAs might work pretty well for some people, but (as usual) Republicans want to make them a one-size-fits-all solution for everyone. You can be sure that, if Bush does begin to focus on HSAs, we'll be deluged with anecdotes about how Joe Blow and Jane Doe started HSAs and are saving big bucks on their health care costs. The fine print, of course, will go unmentioned. Government by anecdote, as in "tort reform," "bankruptcy reform," Social Security, "welfare reform," and so on, is the way things have been done in this country since Reagan.

There's a very simple reason why HSAs will never catch on. Someone above has already mentioned a big part of it: Americans don't save. The other part is that, when it comes to insurance, they don't want to mess with it. Having your insurance through your employer certainly has its drawbacks, but I'm sure most people really like the fact that their insurance is deducted from their gross pay and they don't have to worry about it after they sign up. People don't want to have to contribute to a special account to save up for their health care costs. Telling them that it's more "empowering" this way isn't going to work either: it's already their money, whether they pay it themselves or their employer deducts it from their paycheck.

Posted by: Alek Hidell on January 23, 2006 at 3:31 PM | PERMALINK

I wanted to add my thoughts on this subject based on how my own HSA works. I wasnt even aware this was an ideological issue before seeing the current firestorm on the blogs.

I opted into my employers HSA plan (and out of my current PPO) only recently. I did this after spending a lot of time thinking about the particulars of my employers plan, and came to the conclusion that there was no reason not to switch. To wit:

First, deductibles. True, HSAs provide higher deductibles. Under the PPO, the deductible was $1000, then I pay 20% of everything beyond that until my out-of-pocket hits $5000, and then, everything is covered. Under the HSA, theres a $2500 deductible. However, everything beyond that is covered. And there is no $40 per visit co-pay, as existed with the PPO.

The kicker is with the monthly premium. For coverage for my family, the PPO cost c. $300 per paycheck ($600/month). The HSA cost c. $190 per paycheck. So, assuming I decide to contribute to my HSA the difference (making the per-month cost to me identical between the two plans c. $110 per paycheck) Im adding about $220 per month to the account. Plus, my employer contributes $75/month to the account.

So, to do a comparison.... lets assume that I have medical expenses of $10,000.

Under the PPO, I pay $1000 (up to my deductible), then another $1800 (20% of the difference.)

With the same monthly hit to my paycheck as the PPO, the HSA would work as follows: I pay $2500 for my deductible. Everything beyond that is covered. However, with my employer contribution ($900/year) and my own contribution into the account ($2640/year), clearly, I in a far, far better situation with the HSA. You can run that hypothetical out under any different scenario of medical expenses ($500 in a year, $100,000 in a year), and in every case, I would come out better under the health savings account. So this at least seems to contradict what you say about how HSAs only benefit the young and healthy. Based upon how my plan would work, I come out ahead whether I am healthy in a given year or unhealthy.

(Another consideration. When I pay my medical expenses under the PPO, its with post-tax money. When I pay expenses out of the HSA, it is with pre-tax money.)

Granted, a lot of plans wont work like my employers works. But a lot of them already do.

Posted by: wintermute on January 23, 2006 at 3:34 PM | PERMALINK

Tripp,
HSAs are high deductible insurance plans similar to what are already offered by many private plans. Benefits include all the major stuff like hospital inpatient services, surgical services, outpatient services, etc. I opted for the highest deductible, currently $10,500, in order to reduce my premium as much as possible.

The way I look at this is that I saved enough money on my new HSA plan premium to put more than the $5250 annual maximum contribution into the HSA account. I can also use these funds for dental care, eye care, medicine, etc. that my health care plan does not cover.

Posted by: lou on January 23, 2006 at 3:36 PM | PERMALINK

Tripp: When you find a homeowners insurance policy which pays for routine maintenance, painting the trim, as well as for any damage done to the house, by anyone, in any way, from the first dollar, but only pays 80% if it burns down, your analogy of "House Savings Accounts" might be valid. Health Insurance as we know it isn't insurance, it is a prepaid health care scheme tied to employment. So are HSAs, only HSAs properly incent by causing the user of health care and the buyer to be the same person.

The insurance part of the program kicks in after $2000 (or whatever, there isn't any magic in $2k) in expenses - a catastrophic health care coverage plan which covers all of the really bad stuff like cancer or kidney disease, kind of like when your house burns down, your homeowners pays for your house and your stuff. It can be made friendly to the poor, with a voucher for the premium and a mandate to cover all comers as a condition for insurance companies to accept the voucher. It would probably need to have required coverage like auto insurance to avoid adverse selection issues. The HSA just becomes a way to help bridge the gap. For poor people, plug in Medicaid. (Most folks without any form of health care coverage are either young and stupid, er, healthy, or otherwise could afford coverage.)

It can even be the government that is the insurer for catastrophic care. In that case you can set the level of the deductable and the HSA, which is really just a prepayment of the deductable, based on income. So you have catastrophic coverage single-payer and progressive benefits.

The Dems can take HSAs and 'reorient' them to become back-door almost single-payer, if they just think and participate, rather than just screaming 'It's moron-Bush, it must be bad.' Steal it, run on it and a few other good ideas (call it a 'platform') in '06, and win a few seats, and the Dems can actually have some clout, so they don't have to oppose Bush by having Ted Kennedy hold his breath until he turns blue anymore. Otherwise, they are running on "Bush bad, taxes good" and will lose, again.

Please, we need some legislative gridlock. Become a respectable, electable party with ideas again.

Posted by: rvman on January 23, 2006 at 3:50 PM | PERMALINK
HSAs are high deductible insurance plans similar to what are already offered by many private plans.

No, they aren't.

HSA's are, in most proposals and most existing plans, paired with high-deductible health plans, to be sure, but conceptually the savings account and the health plan are entirely separate.

Posted by: cmdicely on January 23, 2006 at 4:20 PM | PERMALINK

It would be more correct to say:

HSAs require high deductible insurance plans similar to what are already offered by many private plans.

Posted by: Chad on January 23, 2006 at 4:45 PM | PERMALINK

I eventually agreed that the President's SS plan was unworkable in the way he proposed it to work.

We will see if you can convince me that an HSA is bad. But Democrats have already gone along with HSAs, however. You will probable convince me that more incentives are not needed. HSAs are a pretty good deal right now especially if your employer is chipping in part of the cost.

Posted by: Chad on January 23, 2006 at 5:00 PM | PERMALINK

cmdicely and Chad: Yes, insurance companies must meet certain requirements (not sure what they are) to make their high deductible plans eligible to be coupled with Health Savings Accounts. The private health insurance carriers are labeling these insurance plans, "HSA Plans". They are not technically one and the same, but to get the HSA, I had to apply for a completely new high deductible insurance plan because my old high deductible plan was not eligible. This is in fact one means for the insurers to weed out many of the less healthy people they were carrying on their other plans. I was lucky that even with several preexisting conditions, my insurer allowed me into their new plan. I was informed that not many of these new policies are written without the addition of exclusionary waivers for preexisting conditions. I do not know whether my choosing the highest deductible had some impact on that decision, but it may have. Other than for catastrophic coverage, I am now essentially self insured with this high deductible ($10,500 and adjusted annually for COL), HSA plan. Whether or not this provides me with positive or negative incentives to seek medical care on my own, only time will tell. Initially there is a negative incentive to use medical care when it comes from your own pocket. But, once you max out your deductibles, there is a strong temptation to tax your insurer to the max with care that might not be absolutely needed.

Posted by: lou on January 23, 2006 at 5:14 PM | PERMALINK

HEY TRIPP THE HSA = H-orse S-hit A-lfalfa
the company my daughter is employed with just switched her insurance and i might add she is pregnant. her other insurance was a ppo which her doctor accepted .this new insurance , the doctor will not
be a ppo ; so the deductible for her is $ 4000.00.
she could get on the husbands insurance , but his preminums would shoot up to $6.50.00 monthly.
so you tell me who is over insured . even the people working for the insurance companies are being put on the rack nad streched. search the internet to see huw many politicians are tied to these insurance companies
insurance companies was a big problem inthe 1930's
germany . look it up read for yourself. HOWLER MONKEY

Posted by: HOWLER MONKEY on January 23, 2006 at 5:15 PM | PERMALINK

Why can't I have an HSA for small things and insurence for expesive stuff. Don't I alredy have that with a 2K deductable on my plan. BTW, its called health insurence. The insur company takes a risk. They may make money on me or loose money. Why is any different then car insur of HOes insurence.

This is about big business going WalMary and King Goerge is of course carrying the water. Its about the insure inudctry and medicine living in a phoney market of deep pockets. If joe sixpack and mary merlot had to pay ALL the cost of their HC, then the market would shift.

Total BS that people are over insured or using their corp hand out to for un needed treatment.

Big biz is trying to throw off the yoke of healthcare insure. That cost has to go somewhere, the gov, or the people.

Whats wrong with insurence for catastrophic problems, but I cover checkups? When you get really sick, the insurence you pay kicks in.

Health insurence should be like car insurence.

Posted by: the fake Fake Al on January 23, 2006 at 5:22 PM | PERMALINK

It's the now tedious and discredited "moral hazard" argument, trotted out by the Right as the reason for "soaring" healthcare costs: if "care" is available, the morally lax will take advantage of it, even if "those people" aren't ill, which drives up the costs for us more "responsible" healthcare "consumers". The Rove Machine reckons that there is political advantage to be gained by Boosh's HSAs, as the notion that somebody else - no matter how beaten down - can receive government-sponsored care "at the expense of honest taxpayers" still is a winner, in a highly atomised and ultra-fragmented individualistic society. So, why not devote a SOTU speech to such nonsense?

Posted by: barrisj on January 23, 2006 at 5:36 PM | PERMALINK

the fake fake al,
this is probably what is evolving. But we are going through some very convoluted means of getting there. There are some big interests involved in making sure that we don't get there until they wring every penny that they can from the system. If that means keeping Americans as unhealthy as possible without killing the host then the system has succeeded as measured by growth of GDP. Kind of a Darwinian process of selection of the least fit except that a rogue, out of control form of capitalism is doing all the selecting with the aid of our most unrepresentative government.

Posted by: lou on January 23, 2006 at 5:43 PM | PERMALINK

-Just don't think the money will be there under another system. At last check, lots and lots of people don't get really expensive procedures early enough to save their lives under universal health care.- McA

The thing is, I'm not the first or by any means the last person without means, and with need. This is AMERICA! We DO have the money, plenty of it - the problem is, this government's current focus is on ending life instead of saving it. Why worry about boring health care when there are wars to be fought, and fingers to be pointed in righteous blame? Why talk about people that have to choose between buying food and paying for medicine? No one's going to interview me on CNN. I write Congress and no one writes back - the issue's not sexy enough yet, I suppose. I look toward the people in power for help and guidance, and get Musak and voice mail. Government BY the people? Again, all I can do is laugh quizzically at this point, and dig in my heels. So for all the declamatory rhetoric about America's greatness and light. Of COURSE we can provide for our citizens! We just need people to get off their asses and create a system that will work. I've seen good ideas on this thread already.

McA, my kidneys started the steep downslide several months after I'd already committed to readmit college. I'm a slight late-bloomer/ex-party-girl extraordinaire (with a stubborn streak) and I set myself a graduation goal: May 2006. Or else! Thank you for the kind words.

Posted by: Mary Eliz on January 23, 2006 at 5:53 PM | PERMALINK
cmdicely and Chad: Yes, insurance companies must meet certain requirements (not sure what they are) to make their high deductible plans eligible to be coupled with Health Savings Accounts. The private health insurance carriers are labeling these insurance plans, "HSA Plans". They are not technically one and the same, but to get the HSA, I had to apply for a completely new high deductible insurance plan because my old high deductible plan was not eligible.

Its important to distinguish between the two when discussing the validity of providing or allowing "HSAs" as a policy proposal (in the absence of a specific plan), since it is possible to craft a proposal for a new policy which uses an HSA but uses different criteria for the associated health plans, or allows completely free choice of health plans, etc.

Posted by: cmdicely on January 23, 2006 at 5:55 PM | PERMALINK

McA:

At last check, lots and lots of people don't get really expensive procedures early enough to save their lives under universal health care.

Lots of people don't get really expensive -- or even really cheap -- procedures early enough to save their lives under the status quo US healthcare system, either.

Many universal systems do better than the US under virtually every objective outcome measure there is -- and at lower cost (per capita or per GDP).

Posted by: cmdicely on January 23, 2006 at 6:02 PM | PERMALINK

What's twisted about this is that at some companies there's a benefit called an HSA, but that stands for Health Spending Account, not Health Savings Account.

Posted by: hollywood on January 23, 2006 at 7:13 PM | PERMALINK

I'd like to nominate the following for Dumb Comment of the Week:

I believe it would be more correct to say that people who support High deductible insurance/HSAs think that the best way to improve healthcare is for people to have incentives to stay healthy, eat right, and exercise. You know, more European(esp. in the eat right department). Obviously, since old people are already overweight and have smoked most of their lives, then you got to start young and keep them healthy.

Yep, I'm sure that people who are willing to run the risk of a lingering death from lung cancer or congestive heart failure will hasten to mend their ways if we just provide them the right financial incentives to minimize their future health-care costs.

Remind me not to send my kid to whatever business school you're attending, Chad.

Posted by: DaveL on January 23, 2006 at 8:51 PM | PERMALINK

I think it would be worth educating the public more on what it means to be without health insurance. Doh!---that sounds like a no-brainer, right? I don't think so. The problem is that several "truthy" right wing talking points are out there getting in the way of discussion.

I'm sure there are people who know the following details better than me. Please jump in---I'm just trying to get something started.

1) The basic "truthy" right wing talking point, as I see it, is that it doesn't matter if you don't have insurance, because if you get sick you can go to the ER. Have I got that about right?
The short answer to that talking point is, um, not really. If you are in an immediate life and death situation, yes, you have to get care. That leaves a lot of conditions where you won't get treated.
Got cancer? Not dying yet? We'll see you, but don't expect any treatment. Same goes for many other chronic, life-threatening diseases.
Do you think a person without insurance can get anti-AIDS medicines in all 50 states if they don't have the money? I don't think so.
Got diabetes? Tough luck---come back when your blood sugar is over 500.

2) The flip side of the right wing talking point is that treating people in the ER is incredibly expensive---a horrible way to give medical treatment to the uninsured.


Posted by: marky on January 23, 2006 at 9:00 PM | PERMALINK

http://www.cia.gov/cia/publications/factbook/rankorder/2102rank.html

Singapore and Hong Kong are 4th and 5th in the world. Both have maximum tax rates

Capitalism at its finest!

Posted by: McA on January 23, 2006 at 9:20 PM | PERMALINK

Offer free prostrate exams and see the men come in two, three times every day to get a finger up the butt! Yeah, sure. That is just stupid.

Posted by: Tripp on January 23, 2006 at 2:39 PM | PERMALINK

Not all services. But certainly things like physiotherapy, psychotherapy, cosmetic surgery, braces (dentistry) ...do go up.

----------------

Our health-care pricing and financing system is too bizarre and byzantine for an individual to make 'rational buying decisions', even if one thought that healthcare was a place where purely economical criteria were appropriate.

Posted by: biggerbox on January 23, 2006 at 3:20 PM | PERMALINK

You don't make rational buying decisions in universal healthcare either. You get in line unless you are rich enough to fly for healthcare.

And strangely enough the ultra-mega-rich fly to the US.

------------

The thing is, I'm not the first or by any means the last person without means, and with need. This is AMERICA! We DO have the money, plenty of it

Posted by: Mary Eliz on January 23, 2006 at 5:53 PM | PERMALINK

Again, I'm not that sure. If you stopped the entire Iraq war. You'd save about 200 billion. Which would be about less than US$1,000 per person. Which wouldn't pay for socialised medicine for even 1 year.

And you'd have to wonder what Saddam would do in that time.

------------------

McA--
Rich people will pay for it. It's called income taxes.

Posted by: reino on January 23, 2006 at 2:58 PM | PERMALINK

The magic solution! There's always rich people to tax.

Unfortunately, it turns out there's a point of diminishing returns where rich people engage in enough fraud or work less to make further tax hikes on the upper 20% of the population ineffective. No one knows exactly where it is though.

Posted by: McA on January 23, 2006 at 9:44 PM | PERMALINK

By the way, if you want a concrete measure that really adds to life expectancy and raises revenue. Try a 400% tax on ciggies and alcohol.

I'd also tax breast implants and cosmetic surgery.

Posted by: McA on January 23, 2006 at 9:59 PM | PERMALINK

Kevin Drum wrote:
"you put, say, $2,000 in a tax-free account and then buy a health plan that doesn't pay anything until your expenses exceed $2,000. You pay for your normal healthcare expenses by drawing money out of the HSA, and if there's any left over at the end of the year you get to keep it..."


Where to start?

So, the only benefit is that the HCA is tax free? What a typ?

First, they aren't trying to fix the problem. This baby boomer generation isn't into paying for anything. Remember, they're the "me" generation and they're more into "tax cuts" than 'fiscal responsibility'. Nope, it sounds to me as though the Republicans are trying to shake down the rest of the medical industry. They got help from Big Pharma (I'm supposing) and then Big Pharma got their Medicare benefit. Now they want doctors, hospitals and the like to pony up.

The problem isn't planned to be fixed until baby boomers are no longer going to be on the hook. They're going to pass the buck to their children and grandchildren because they can. Nice people, eh?

Posted by: MarkH on January 23, 2006 at 10:30 PM | PERMALINK

Just as a bye-the-way re: Canadian healthcare comparisons :
Pharmaceuticals and most dental procedures are not covered by Medicare (except where part of in-hospital treatment).
The province (state to you) covers pharma and dental for welfare : necessities only : federal cost sharing.
Wait times ? They exist, but usually are not the end of the world.

Posted by: opit on January 23, 2006 at 11:53 PM | PERMALINK

Just as a bye-the-way re: Canadian healthcare comparisons :

Posted by: opit on January 23, 2006 at 11:53 PM | PERMALINK

Does Canada extend care to undocumented migrants?
The US does, which might make universal healthcare a little more expensive than Canada's.

Congrats on your new conservative govt by the way.

Posted by: McA on January 24, 2006 at 12:20 AM | PERMALINK

I think that, like social security, we need to move toward a universal-type of health care. Conservatives often don't understand the purpose of broad-based government services. In the case of social security, it's not designed to make people retire in luxury, it's designed to prevent poverty among retired workers. Universal health care would operate the same way - provide base levels of medical care for everyone, with available options to add coverage for those who can afford it.
I'm fortunate to be able to afford it. And if some of my tax dollars go to providing health care for Mary Eliz because she can't afford it, well, that just DOESN'T BOTHER ME.
I consider it like rent for living in a great country.

Posted by: DK2 on January 24, 2006 at 12:55 AM | PERMALINK

"Yep, I'm sure that people who are willing to run the risk of a lingering death from lung cancer or congestive heart failure will hasten to mend their ways if we just provide them the right financial incentives to minimize their future health-care costs.

Remind me not to send my kid to whatever business school you're attending, Chad."

Obviously, Americans eat healthier and exercise more than their counterparts and its this dumb system of ours that produces all these costs. That may be it, but I doubt it. I really think my dad has diabetes because of his lifestyle choices. He continues to have these problems because he'd rather take a pill than change.

Posted by: Chad on January 24, 2006 at 12:56 AM | PERMALINK

Chad, the point is that if the prospect of a slow painful death isn't enough incentive to change your lifestyle when you're young, it seems fairly unlikely that the risk of higher health-insurance premiums is going to do the trick. People already have lots of incentive to stay healthy to avoid that whole slow painful death at an early age thing. Do you really think that threatening slow painful death at an early age AND HIGH HEALTH INSURANCE PREMIUMS!! is going to get them off the couch, off the cigarettes, and down to the gym? Color me skeptical.

Posted by: DaveL on January 24, 2006 at 2:10 AM | PERMALINK

pacific poker

Posted by: pacific poker on January 24, 2006 at 5:39 AM | PERMALINK

pacific poker

Posted by: pacific poker on January 24, 2006 at 5:41 AM | PERMALINK

The same is true for the government. Federal employees are content to make a living with good health care and pensions. They do not expect a 20% profit. They are merit oriented and have to take tests to prove they can do what their job description says.

The VA does its job very well when allowed. Drs. and nurses there are really into healing and preventive care if possible. They do very well with one half the cost. The Congress of Repigs keeps trying to keep them from doing as well as they do so we won't get any ideas that it really can be done.

Posted by: Yoduuuh on January 24, 2006 at 6:53 AM | PERMALINK

I just had a post removed and I would like to know why.

There was no profanity or anything that I could see requiring censorship.

tbroz and one other poster replied and their posts are also gone?

Posted by: Yoduuuh on January 24, 2006 at 7:05 AM | PERMALINK

I think you posted in another thread.

Posted by: McA on January 24, 2006 at 8:01 AM | PERMALINK

The incentive to stay healthy is in not losing the money that's in the savings account, not in the premiums. And if its not an incentive enough, that's fine. But it seems fair to me that the people who don't smoke, eat right, exercise, and aren't a drain on society should get rewarded for that.

Posted by: Chad on January 24, 2006 at 8:35 AM | PERMALINK

Chad,

I'm just like you - I don't smoke, eat right, exercise, and am not a drain on society. I've enjoyed almost 50 years of relatively good health.

That is my reward.

Should I sign a pact that says I commit suicide when I lose my job to Communist China?

Someday, Chad, you yourself will be a drain on society. You were a drain the first 18 years of your life and you're finally paying some of that back. You took advantage of all the schooling and health care and stable society I and others provided for you. Once you've paid that back you can talk about rewards.

If you don't like it then go live in the Libertarian paradise of Afghanistan. There are absolutely no taxes there. Everyone reaps exactly the rewards of their fine contributions with no drain at all.

Posted by: Tripp on January 24, 2006 at 10:14 AM | PERMALINK

Yeah. Great plan. Setup accounts that people are expected to "invest in" to deal with medical problems. Setup accounts that people ALSO need to invest in to survive retirement. With all the accounts that BushCo are trying to force upon people while taking AWAY safety nets left and right, there will be no money left to the people to buy food, gas, and pay utilities. Just keep piling on more and more "private" accounts for this and that for people to take part in because there's no alternative...while NOT increasing their pay (just increasing the pay of executives: only 11 times higher than average company worker pay in the UK, 20 times higher in Japan, 200 times higher in the US for less quality and poor performance! Japan ALWAYS produces better/superior product and service than overpaid US execs/companies so that excessive exec pay is crap...but I digress).

THE answer to the healthcare mess is national healthcare. Period. Single payer. Period. No waiting lines, more equipment, more doctors. Empirical fact. The US pays VASTLY more for LESS healthcare than EVERY other developed nation on earth. Clearly the US way is the wrong way and always has been.

Posted by: Praedor Atrebates on January 24, 2006 at 11:28 AM | PERMALINK

THE answer to the healthcare mess is national healthcare. Period. Single payer. Period. No waiting lines, more equipment, more doctors.

Posted by: Praedor Atrebates on January 24, 2006 at 11:28 AM | PERMALINK

Find one universal healthcare system with no waiting lines and no waste. Doesn't exist.

Posted by: McA on January 24, 2006 at 11:34 AM | PERMALINK

I'm not going anywhere. I'm planning on having to live with you. I'm trying to support solutions that deal with the fact that you and I are both going to be here.

I'm not suggesting that Medicare(you know, single payer for over 65s) is going anywhere. It's expanding under Bush. Clearly, private health insurance(Er or Ee) is for people under 65 in this country who are capable of supporting themselves.

I'm assuming the following as being true:

On average, individuals who live an unhealthy lifestyle have higher health care costs.

On average, Americans live a more unhealthy lifestyle than most European countries.

Posted by: Chad on January 24, 2006 at 12:42 PM | PERMALINK

Chad,

Your focus on 'unhealthy lifestyle' is focusing on a minor point and trying to make it a major point.

For starters, Americans smoke less than many other nations. We also drink less than many other nations, and certainly less than we have in the past.

That leaves overeating and obesity. If you really want to help that problem then eliminate video games and make America a lot smaller so we can walk places instead of driving a car.

I'm watching my Grandfather die right now. He has lived an essentially healthy lifestyle, and now in the final year or so of his life he is racking up a HUGE medical bill. It may have been cheaper if he had smoked and died of a sudden heart attack years ago.

Posted by: Tripp on January 24, 2006 at 2:23 PM | PERMALINK

Find one universal healthcare system with no waiting lines and no waste. Doesn't exist.

McStrawman,

Simple queueing theory tells you that it is impossible to design any system with a supplier that guarantees no waits for both the supplier and customer. Either you optimize for the customer and waste some of the Drs time or you optimize for the Doctor and waste some customer time.

So nice try at creating an impossible standard as a strawman.

Posted by: Tripp on January 24, 2006 at 2:29 PM | PERMALINK

McA's criterion for "no waste" made me guffaw. The USA system is far more wasteful of resources than most other Western countries'. We spend more money by almost a factor of 2, and have incredibly high administrative costs.
Futher, there are 2 million people in the US employed by insurance companies whose job is to deny your coverage as much as possible. Oh yeah, give me that American efficiency, baby.

Posted by: marky on January 24, 2006 at 5:44 PM | PERMALINK

"If you really want to help that problem then eliminate video games and make America a lot smaller so we can walk places instead of driving a car."

I feel like we can accomplish a lot without having to impend on individual's right to live as they choose and without having to become god.

Posted by: Chad on January 25, 2006 at 9:30 AM | PERMALINK

Funny, there are few comments about the attitude that is the root of many of these proposals.

I.e., the 'free-market' can solve any problem.

This opinion is fallacious for many reasons, but what really ticks me off is that this opinion seems to be expressed by people who stopped studying economics after ECON 101.

The free-market ideal is an ideal which says that given indistinguishable products, complete consumer information, no barriers to entry, many sources of supply, and the suppliers have no control over the price. There are no examples of the perfect free-market, anywhere.

Health care fails to be a free market in at least four of the five requirements. For example, consumers do not have complete information, that's why we are willing to pay the specialists.

Insurance, regardless whether it's national or private, was originally intended to spread the costs of individual care across a large number of people. The idea being that everyone is ill at times, but not all at the same time. So it makes sense for society, as an aggregate, to collectively pay for the health care costs of individuals.

Competition between insurance companies leads to their attempting to seperate the people requiring more expensive care from those who are fairly healthy. This seperation of the aggregate into individuals allows them to adjust their fees to charge individuals different amounts based on their health care needs. It also allows them to be competitive in the marketplace by allowing them to offer lower fees to the healthy people. Offering lower fees to the large numbers of healthy people means they can get those people to sign on to their insurance.

Do you see what competition in the health care arena has caused? Instead of providing similar fees to every subscriber and realizing that some will have higher expenses than others, the insurance industry is now setting different fees to individuals. Exactly the form of behavior the insurance industry was created to prevent!

The HSA proposal does not address the underlying problems of health care. The free-market, competitive model causes the problem! The exact same benefit that the HSA provides could be done by allowing everyone to deduct up to $2000 per year of their taxable income on itemized medical expenses. Without any fees to the account managers.

The free-market is not the solution to every problem. Sometimes it makes things worse.

-Flex

Posted by: Flex on January 25, 2006 at 11:30 AM | PERMALINK

Tripp: "He has lived an essentially healthy lifestyle, and now in the final year or so of his life he is racking up a HUGE medical bill."

You've found the problem, you just haven't come up with a solution. We Americans spend inordinate amounts of money in the last year. The Europeans, at most, spend enough to make the dying comfortable in their beds, and then let them die. They then spend part of the savings on helping those whose lives may be saved. The rest they don't spend. Cold-blooded calculation by the state, rather than customer choice.

Unless we as voters can make the call to let our Grandfathers die, we won't save anything by going to single payer. I don't think the votes are there, and what we would end up with is a lot of spending on extraordinary measures which add up to very little extended life or quality of life. Just like today. Our health care costs a lot because Americans don't give up on lost causes, and believe in miracles, so we fight death to the last dollar and breath. I would prefer to let medical consumers (i.e. Grandfather and family) pay for and make that decision, rather than the state. If you want to equalize health outcomes in this country, fix Medicaid, expand it to the poor old, and eliminate Medicare. (COBRA also needs a fix - it is worthless in its present form.)

Posted by: rvman on January 25, 2006 at 11:31 AM | PERMALINK

rvman,

For the record my grandfather is well off and I do not know what public assistance (if any) he is receiving with his hospital bill.

I think that extraordinary efforts to extend life (think Terry Schaivo as the poster girl of this) are a main part of the problem.

The second part of our problem is, in some cases, poor healthcare for infants. I think you can make a strong business case for improving childcare from pre-natal through 5 years and having that pay off down the road in less crime and more productive citizens.

I don't have any easy solutions for this, but I'd rather talk about these issues than reciting slogans or scapegoating minority groups such as smokers or fatties.

Posted by: Tripp on January 25, 2006 at 12:16 PM | PERMALINK




 

 

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