A long time ago, I had one of those mythical government health care policies. You know the kind, you show your card and everything is paid for. I loved it. At that time health care cost a much smaller portion of our GDP, and many people had better coverage than they do today. It’s been getting worse for a long time. Today though I have something I like even better, a Health Savings Account (HSA) and a high deductible insurance policy. Combined these have got to pretty much cover the most hated trend in insurance today, shifting costs to the insured. And I really am happy.
The health care debate is going on full steam right now and there starting to be enough cracks in the wall to think it could come tumbling down. How very sad for all of us. I have been following this debate for a long time. I was very interested in this in round one: the Hillary Plan. While I’m not sure that was the best plan, having enacted it, I doubt we’d be facing health care costs approaching 25% of our GDP in our near future. I am amazed that there are people arguing that our current broken system is actually better for us than a government run program might have been.
I am open to a government run plan to compete with the big insurance companies. I’d want to be very careful to understand the costs, making every aspect available via data.gov so people can make real comparisons. I’d prefer not to see the government subsidize the program with taxes over and beyond premiums. If government can’t get it done for reasonable all in costs, and we can really know that, I’m all for it. If private insurers can beat those costs, we should all go for that. If not, say because feeding profit expectations just costs us too much, then we have a real alternative. I honestly can’t say which one will win, but it will not be the same.
An HSA is the antithesis of of a government run plan. No bureaucrats, government or corporate, are involved in day to day health decisions. I decide what is covered or not, at least until my saved money is gone. What most people complain about is that up until the deductible is spent it all comes out of your own pocket. So if you have a $4000 deductible, you spend $4000 before you ever get a dime of coverage. At least with a conventional plan you get to argue with your insurer for awhile before they pay partial claims or just outright deny you. You don’t have to pony up real funds until the shouting is over.
The plan I have is different. My employer decided to take the difference between what a traditional plan cost and what a high deductible plan costs, and deposit the difference into our HSA. This way, there is always a balance available, at least that is until I spend the available deposits. It tends to work just the opposite of a traditional plan. With a traditional plan, you start paying co-pays or out of pocket until some magic number is reached, and then the full insurance kicks in. With an pre-funded HSA, you pay off your balance until it is run out, and only then do you pay out of pocket. Unless you are chronically ill, and assuming you spend wisely, you may never run out of funds. I haven’t in the three years I’ve been on this plan. But this isn’t even the best part.
I can use my HSA balance for a much larger range of expenses than what any insurance company would ever allow. Allowable expenses include over the counter drugs, chiropractors, physical therapy, dentists, eye wear and exams, equipment and many more things. I have complete control over who I see. The rules for my spending are set by the government, not a corporate bureaucrat, and their “stick” should you break the rules could be income tax penalties. But the rules are much more encompassing than anything any insurance plan would ever allow. It does put in in the seat to ask about how much things cost. I like that, I do it with everything else I buy.You do have to ask questions of your doctor, something most of us seemed trained not to do. This needs to be made easier, so you can compare costs of tests, of diagnostics, surgeries, or medicines and other routine expenses. There is a lot of room for improvement here.
A word of warning, these expenses may not count against your deductible, a risk should you get more seriously ill, and this is an area where reform would be really important. I’d also like to see some sort of loan garauntees and a line of credit for when your balance runs out but your deductible hasn’t been met.
Perhaps this new government option will both come to be, and will provide real competition to the broken current system. But I really hope the type of plan I have remains, and is considered in the mix of this whole debate.