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Insurance News - Are HSAs Doomed Under ObamaCare?Are HSAs Doomed Under ObamaCare? GRACE-MARIE TURNER
ObamaCare has claimed the first of what surely will be many victims in the insurance industry. A Richmond, Va., insurance company called nHealth has closed its doors due to the "new demands imposed by national health care reforms," according to a letter from a co-founder.
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NHealth specialized in insurance plans that coupled incentives for wellness and coordinated care with health savings accounts (HSAs). ... CEO Paul Kitchen said ObamaCare creates so many uncertainties that investors believed the company's offerings could not comply with the bureaucratic requirements of the new law.
Unfortunately, several of ObamaCare's provisions could doom all HSAs. Patients would suffer because they would have fewer insurance choices and would be forced to pay for much more extensive and expensive health insurance.
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When McKinsey & Co., a consulting firm, analyzed the early impact of HSA-compatible health plans, its researchers found that people with consumer-driven plans were more value-conscious.
They were 50% more likely to ask about costs and three times more likely to have chosen a less-extensive, less-expensive treatment option, like calling a nurse hotline instead of visiting a hospital emergency room. There was no evidence they were skimping on care, and in fact, HSA holders were more likely to get preventive care than those with traditional insurance.
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The health law requires that all insurance policies provide a minimum actuarial value of at least 60% for the benefits covered. If HHS allows contributions by individuals and employers to health savings accounts to "count" as part of the actuarial value, then HSAs and other account-based plans would likely meet the test. But if contributions are not included, the plans likely would not qualify, removing an important tool to hold health costs down.
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Washington should make sure that HSAs remain an option. These plans expand patient choice and encourage just the sort of responsible medical spending that can drive down health costs. NHealth's closing is a warning sign that ObamaCare must be stopped before it forces more innovative companies to shut their doors and deprives 10 million people of an affordable health insurance option.
I love my HSA/HDHP. Obama promised I could keep it. November's election seems the only path to a solution = vote in new Congress to repeal ObamaCare.