NCPA - National Center for Policy Analysis


July 19, 2004

Since Health Savings Accounts became available to consumers on January 1, 2004, real data is emerging to replace speculation. In the first six months, tens of thousands of Americans have purchased HSAs, says Laura Trueman, executive director of the Coalition for Affordable Health Coverage (

Two companies have collected and shared demographics about who is purchasing HSAs. Assurant Health (formerly Fortis) and eHealthInsurance. The data provide a broad-based look at what is happening in the market, says Trueman.

HSAs have already reduced the number of uninsured Americans:

  • Some 43 percent of HSA applicants did not indicate any prior coverage, according to Assurant.
  • Nearly one-third (32.8 percent) of all HSA applicants to eHealthInsurance -- and about half of those with incomes under $35,000 -- had not had coverage for at least six months prior to enrollment.

HSA purchasers come from many income and vocational backgrounds:

  • Nearly half (46 percent) of HSA purchasers have family incomes of less than $50,000, according to eHealthInsurance.
  • Some 38 percent of its HSA purchasers have only high school or technical school training, says Assurant.
  • Many HSA purchasers live in modest homes -- 38 percent in homes with a market value of less than $125,000 -- and 27 percent of enrollees have a net worth of less than $25,000 (Assurant).

There is still much to be done to make health insurance more affordable to all Americans, but early experience with HSAs should make policymakers think seriously about how to harness the power of consumer choice and market incentives, says Trueman.

Source: Laura Trueman, "Health Savings Accounts: Myth vs. Fact," BA No. 479, July 19, 2004, National Center for Policy Analysis.

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