April 29, 2012

STRENGTHENING THE CASE FOR UNIVERSAL HSAs:

In Hopeful Sign, Health Spending Is Flattening Out (ANNIE LOWREY, 4/29/12, NY Times)

The implications of a bend in the cost curve would be enormous. Policy makers on both sides of the aisle see rising health care costs as the central threat to household budgets and the country's fiscal health. If the growth in Medicare were to come down to a rate of only 1 percentage point a year faster than the economy's growth, the projected long-term deficit would fall by more than one-third.

The growth of health costs slowed in the 1990s as health maintenance organizations became more popular. That played a role in both gains in household income -- less money on employer-provided health benefits means more money for raises -- and in budget surpluses, economists argue. [...]

Many experts -- and the Medicare and Medicaid center itself -- point to the explosion of high-deductible plans, in which consumers have lower premiums but pay more out of pocket, as one main factor. The share of employees enrolled in high-deductible plans surged to 13 percent in 2011 from 3 percent in 2006, according to Mercer Consulting.

That means thousands of consumers with an incentive to think twice about heading to the doctor. One study by the RAND Corporation found that health spending among people who shifted into a high-deductible plan dropped 14 percent -- though the study also found that enrollees cut back on some care that tended to save money in the long run, like vaccinations. 

Posted by at April 29, 2012 4:04 PM
  

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