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> Instead, why not bump up IRA contribution limits and allow penalty-free distributions for qualified medical expenses? Seems indistinguishable from a higher l

by bhupy 6y ago

> Instead, why not bump up IRA contribution limits and allow penalty-free distributions for qualified medical expenses? Seems indistinguishable from a higher limit HSA, but I'm on board with that. > Why restrict HSAs to high-deductible health plans? Removing this restriction is a great idea! I agree. > Why are we asking people to deal with investment stuff in order to pay for their healthcare? Most HSA providers use robo-investment. Where active investment is an option, it's usually only used by the most savvy users. Half the value add of most off your HSA providers is this investment management, which 100% beats having it sit around in cash. > Isn't that the point of an insurance company? You pay them premiums, they invest the money and pay for all your healthcare needs - none of that co-pay, coinsurance, deductible shit. This is really debatable, because the concept of "insurance", traditionally, is tail risk mitigation. Having insurance pay for everything from flu shots to regular check-ups makes it something else entirely, that's no longer insurance, it's a glorified health payment plan with all of the price information removed. Indiana has a very interesting program for their government employees, where they offer "deductible security", in which the state provides a health savings account into which it deposits an amount equal to the annual deductible every year. Another potential policy avenue to incorporate with HSA's.

triceratops 6y ago
> Having insurance pay for everything from flu shots to regular check-ups makes it something else entirely, that's no longer insurance, I don't disagree with that sentiment. However, it's my understanding that traditional health insurance in the US pays for those things (often without co-pay) because preventative treatments are cheaper. If you add a co-pay for getting a flu shot, or even worse don't cover it, many more people might skip it and some of them will inevitably develop the flu. Treating those cases will likely end up costing way more than paying for flu shots for all the insureds. I get that HSAs are an attempt to give patients more pricing information and agency, and encourage them to shop around for their healthcare. But (to me) it comes off as a self-managed insurance plan that you use to pay for your actual health insurance. It's insurance for insurance. Which is slightly bananas.
- bhupy 6y ago
  > However, it's my understanding that traditional health insurance in the US pays for those things (often without co-pay) because preventative treatments are cheaper. If you add a co-pay for getting a flu shot, or even worse don't cover it, many more people might skip it and some of them will inevitably develop the flu. Treating those cases will likely end up costing way more than paying for flu shots for all the insureds. So full disclosure: I work in insurance and adjust claims myself. This is certainly a reasonable cost-reduction strategy, but it isn't necessarily the most cost effective strategy, nor is it the only strategy. Indeed, Singapore has shown us that you can achieve more efficient per capita health spending WITHOUT covering flu shot co-pays, etc for everyone. > But (to me) it comes off as a self-managed insurance plan that you use to pay for your actual health insurance. It's insurance for insurance. Which is slightly bananas. I recommend listening to 3 or so minutes of this Reuters podcast (starting at 12:30)[1] that talks about Singapore's healthcare system, its journey trying different systems out, and some of its learnings. One key insight that they picked up on was that for the vast majority of people, the bulk of one's healthcare expenditure in life occurs at older ages once health starts to deteriorate. In that regard, it's almost like social security, where you save up over the course of your lifetime and build up this trust fund that you would eventually expect to use once you're older...which is largely what HSA's are: a savings account in a wealth fund that grows over time. [1] https://soundcloud.com/reuters/the-exchange-too-small-to-fail https://soundcloud.com/reuters/the-exchange-too-small-to-fai...
  - triceratops 6y ago
    Gotcha. Thanks for the thoughtful responses and the pointer to that podcast.

by bhupy 6y ago

triceratops 6y ago

> Having insurance pay for everything from flu shots to regular check-ups makes it something else entirely, that's no longer insurance, I don't disagree with that sentiment. However, it's my understanding that traditional health insurance in the US pays for those things (often without co-pay) because preventative treatments are cheaper. If you add a co-pay for getting a flu shot, or even worse don't cover it, many more people might skip it and some of them will inevitably develop the flu. Treating those cases will likely end up costing way more than paying for flu shots for all the insureds. I get that HSAs are an attempt to give patients more pricing information and agency, and encourage them to shop around for their healthcare. But (to me) it comes off as a self-managed insurance plan that you use to pay for your actual health insurance. It's insurance for insurance. Which is slightly bananas.

bhupy 6y ago
> However, it's my understanding that traditional health insurance in the US pays for those things (often without co-pay) because preventative treatments are cheaper. If you add a co-pay for getting a flu shot, or even worse don't cover it, many more people might skip it and some of them will inevitably develop the flu. Treating those cases will likely end up costing way more than paying for flu shots for all the insureds. So full disclosure: I work in insurance and adjust claims myself. This is certainly a reasonable cost-reduction strategy, but it isn't necessarily the most cost effective strategy, nor is it the only strategy. Indeed, Singapore has shown us that you can achieve more efficient per capita health spending WITHOUT covering flu shot co-pays, etc for everyone. > But (to me) it comes off as a self-managed insurance plan that you use to pay for your actual health insurance. It's insurance for insurance. Which is slightly bananas. I recommend listening to 3 or so minutes of this Reuters podcast (starting at 12:30)[1] that talks about Singapore's healthcare system, its journey trying different systems out, and some of its learnings. One key insight that they picked up on was that for the vast majority of people, the bulk of one's healthcare expenditure in life occurs at older ages once health starts to deteriorate. In that regard, it's almost like social security, where you save up over the course of your lifetime and build up this trust fund that you would eventually expect to use once you're older...which is largely what HSA's are: a savings account in a wealth fund that grows over time. [1] https://soundcloud.com/reuters/the-exchange-too-small-to-fail https://soundcloud.com/reuters/the-exchange-too-small-to-fai...
- triceratops 6y ago
  Gotcha. Thanks for the thoughtful responses and the pointer to that podcast.