Darrow: Health savings accounts essential to build a vibrant healthcare system

Writing in The Hill, Millennial Policy Center Fellow Juliana Darrow explores the benefits of health savings accounts and how they fit into the American Health Care Act:

“On Monday, Republicans released their much-anticipated replacement proposal, The American Healthcare Act (AHCA). The alternative to the Affordable Care Act has the potential to actually make healthcare more affordable for Americans. The goal of the legislation is to get to a market that functions efficiently without the need for excessive regulation in both the individual and employer markets. One of the key provisions of the bill is the expansion of health savings accounts (HSA).

Although HSAs have been around since 2003, and are standard in health insurance discussions, they are underutilized and underappreciated. Expanding and encouraging widespread HSA use has the potential to transform the way care is consumed and health insurance is used.The AHCA doubles HSA account contribution limits, allows catch-up coverage, and expands the definition of qualified medical expenses. This will be the key mechanism for reforming the current system.

In broad terms, the only way to get to an efficient market is to decrease regulation and to foster competition.

Health insurance regulations and other third-party payment mechanisms greatly distort the ability of healthcare markets to function like other sectors of the economy. The idea that consumers need to give control of decisions and payment over to health insurance companies to get quality care is simply not true. There are no quick fixes or silver bullets, but congressional action to give consumers more control over their own healthcare dollars is a good place to start.”

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Health savings accounts are an essential part of rebuilding our healthcare system into a vibrant, consumer-driven marketplace.Juliana Darrow, Fellow

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