Sara Collins, Assistant Vice President of the Commonwealth Fund,
offered Congressional testimony on why Health Savings Accounts (HSAs)
are bad, bad, bad. Unfortunately, she chose to misrepesent some basic
facts, belittle the growing popularity of the two-year-old insurance
option, and (surprise) argue for more government intervention in the
health care and health insurance markets. Compare her testimony with Michael Cannon’s recent Cato Policy Paper on HSA Critics.
Examples:
Collins
says Americans have higher out-of-pocket costs than other OECD
countries. True enough, but her graph shows that we spend about $800 of
our own money for $6,000 worth of care. The OECD median is about $400
out-of-pocket for $2,100 worth of care. So out-of-pocket expenses for
Americans are 13% of total spending versus 19% for the rest of the OECD.
Inflation-adjusted
out-of-pocket expenses reached $788 in 2004, up from $667 in 1996, but
out-of-pocket expenses were $774 in 1990. Collins insists on noting
only the increase in out-of-pocket costs.
Like many others, Collins misrepresents the results of the RAND Health Insurance Experiment,
which shows higher personal costs result in little or no impact on
health, even if people choose not to seek care as often as they
otherwise would.
HSAs do not have the same level of subscribers
as traditional insurance, but they only became an option with the 2003
Medicare law and are increasingly popular.
