Smoke and Mirrors, Mirrors and Smoke

I have a flexible spending health account in addition to the insurance from my employer. My insurance premium goes up every year and co-pays and uncovered expenses go up as well. I have a flexible spending account because the amount of money I spend out of pocket for things my insurance doesn't cover keeps increasing. It is not a substitute for health insurance. It is not making my insurance cheaper. It is not helping my take home bottom line.

What the heck is the President trying to pull with this HSA plan? How will that help people who don't have insurance? I am pretty darned blessed a) to work at a company that allows me to save a few tax dollars with my FSA b) that I can afford to set aside a grand or two or three per year (though I'd rather that money go to my 401K). People who don't have an adequate salary or have a family may not be able to utilize this because, as I said, it affects your take home bottom line. These studies show that this is yet another ruse by this administration which will, ultimately, end up lining the pocket of some big corporation. After all, who gets to hold all of the money that you sock away in these HSAs?

The Center on Budget and Policy Priorities has released a new study by MIT economist Jonathan Gruber showing that President Bush's proposal to expand Health Savings Accounts (HSAs) would actually increase the total number of uninsured people in the United States. While 3.8 million people would gain coverage, another 4.4 million would actually lose coverage as a number of employers responded to the new tax breaks by dropping their insurance plans. So on net, more people are uninsured. And this all comes at a cost of $156 billion over ten years. Absolutely brilliant.

Now from what I understand, it seems like Gruber's arguing that those 4.4 million would actually see little or no change in real compensation—what will happen is that many small businesses will just prefer to pay their workers in wages rather than health insurance once the tax advantages towards doing the latter disappear—and those 4.4 million would simply choose not to buy insurance. So it's not clear that the situation is entirely catastrophic. (Although those 4.4 million would all likely be relatively healthy people, and their exit from the insurance pool would raise premiums for everyone else.)

Still, we know that HSAs won't reduce total health care costs (how could they, when 80 percent of costs in this country are due to 20 percent of all patients, and that small minority simply can't and won't control their costs by taking out a high deductible?). They do virtually nothing to address the main health care problem in this country: that 60 million people go uninsured in any given year. Besides which, they transfer the costs of health care from the healthy and wealthy to the sick and the poor. In what universe is this a good use of money? We already have a perfectly good single-payer system in this country—Medicare—that, despite Republican efforts to screw it up, does a wonderful job of controlling costs and achieving universal among a vulnerable and expensive population group. A serious health care proposal might look at expanding that rather than tinkering around with frivolous tax breaks at the margins.

This is really disheartening. I am so sick of hearing the talking points from Bush's deceptive road shows. His plan will not help people who don't have insurance and will end up ensuring that more people aren't insured. He's trying to destroy America!