NCPA - National Center for Policy Analysis


March 9, 2006

Until recently, much of the data available on Health Savings Accounts (HSAs) has come from individual carriers, conservative think tanks and trade associations. HSA skeptics have doubted their figures -- which show that between 33 percent and 40 percent of those purchasing HSAs were previously uninsured.

The first academic research on HSAs, published in the November/December issue of Health Affairs, reviews the relative merits and potential of various proposals to expand HSA affordability for the uninsured.

The team performed sophisticated forecasting simulations of the extent to which several different policy proposals -- including President George W. Bush's health care tax credit for HSAs -- would:

  • Reduce the number of uninsured.
  • Reach the low-income uninsured.
  • Cause people receiving employer-subsidized group coverage to drop it and move to the individual market (presumably for a better deal).

Overall, the authors concluded that "widespread national adoption of individual HSA plans is possible" and early indications are that HSAs are a viable alternative to existing types of health plans.

"The academic community finally is coming around to see that HSAs, in conjunction with refundable tax credits, could dramatically reduce the number of uninsured," said Grace-Marie Turner, president of the Galen Institute. "It will be very hard for opponents of HSAs to ignore this study in the top health policy journal. This is an important breakthrough."

Source: Laura Clay Trueman, "HSAs Can Help the Uninsured, Study Says," Health Care News, Heartland Institute, January 1, 2006; Roger Feldman et al., "Health Savings Accounts: Early Estimates Of National Take-Up," Health Affairs, Vol. 24, No. 6, 2005.

For study text:


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