Health savings accounts: An insurance reform success

These products combining savings accounts and high-deductible health plans are catching on, and even attracting some consumers and businesses that previously had no coverage.

Editorial. June 13, 2005.

First the bad news. More than 20 million working adults are going without health coverage in this country, according to a recent analysis of Centers for Disease Control and Prevention data released by the Robert Wood Johnson Foundation. That's almost half of the estimated 45 million Americans who lack insurance.

These uninsured workers often are unable to see a doctor when needed, are less likely to have a medical home, and are more likely to say they are in poor or fair health, the report found.

Now the good news. A relatively new form of health coverage -- the health savings account -- is catching on and helping to expand coverage to people who were previously uninsured, including many working for small businesses.

The AMA fought for the saving accounts' passage as part of the 2003 Medicare reform bill. And last June, the House of Delegates directed the Association to "strongly encourage employers to consider offering HSAs as an option for their employees."

More than 1 million people now get their coverage through HSAs, according to a recent study by the trade group America's Health Insurance Plans. That's up from 438,000 people last September. Already these tax-exempt savings accounts coupled with high-deductible insurance plans have outshone their more restrictive predecessor, medical savings accounts, in popularity.