This Is The Only Way To Save Healthcare In The U.S. _ What's Ahead

Forbes

Steve Forbes touts two bills making their way through Congress that can help lower healthcare costs on cash-strapped consumers in the U.S.

Transcript

00:00 The only way to save American health care is to get patients in charge of the money,

00:04 not third parties like the government and large insurers.

00:08 Two bills making their way through Congress will help that transformation.

00:12 [music]

00:15 Hello, I'm Steve Forbes and this is What's Ahead, where you get the insights you need

00:19 to better navigate these turbulent times.

00:22 Why do health care costs keep rising?

00:25 Because, unlike other markets, the consumer, in this case the patient, is not in charge.

00:31 Third parties are, primarily, large insurance companies and Medicare and Medicaid.

00:37 Most non-government policies come from employers.

00:40 Health savings accounts, HSAs, which have been around for 20 years, permit patients

00:46 to directly control certain funds rather than those third parties.

00:50 Money can be contributed tax-free by individuals and employers.

00:55 It grows tax-free in the HSA.

00:58 Funds can be withdrawn tax-free to pay for qualifying medical expenses.

01:03 HSAs are available only in conjunction with high-deductible health insurance plans.

01:09 Today, there are 35 million HSAs covering over 65 million people.

01:16 HSA accounts have $116 billion in assets.

01:21 The advantage of an HSA, aside from being a great savings vehicle, is that you are in

01:26 charge of how the money is spent.

01:28 Let's say you need a prescription.

01:30 You can compare prices offered by certain providers.

01:34 The savings are yours, not the employers'.

01:38 What you don't use in your HSA grows tax-free.

01:41 When you leave this world, any funds in your HSA can be passed on to your heirs.

01:47 The trouble with health savings accounts is that they are burdened with all sorts of restrictions

01:52 that limit their popularity and potency.

01:55 Two bills, the HSA Modernization Act and the bipartisan HSA Improvement Act, are making

02:02 their way through Congress that will remove some of these obstacles.

02:06 For starters, the limits on how much that can be contributed each year to an HSA will

02:11 be almost doubled.

02:13 Under current law, contributions are capped at $3,850 for individuals and $7,750 for families.

02:23 Those caps will rise to $7,500 for individuals and $15,000 for families.

02:31 Among other things, the bills would allow people on Medicare who are still working to

02:36 keep an HSA.

02:38 Currently, they are being barred from doing so.

02:41 Eligibility would also be expanded for veterans receiving care through the Veterans Administration,

02:47 and Native Americans would have access as well.

02:50 The bills would end the marriage penalty by permitting couples to combine their accounts.

02:55 They would allow a person to keep an HSA even if their spouse is enrolled in a flexible

03:01 spending arrangement.

03:03 They can combine these spending arrangements into a health savings account.

03:07 There are other improvements.

03:09 These bills are very helpful, but much more needs to be done to really put the patient

03:14 in the driver's seat in the health care market.

03:17 HSAs should be available to everybody, regardless of their other insurance arrangements.

03:23 The contribution caps should be substantially expanded.

03:27 People should be able to use HSAs to pay premiums for their own health insurance policy if they

03:32 so desire.

03:34 Any remaining restrictions on where and how people get medical services should go by the

03:39 boards.

03:40 I'm Steve Forbes.

03:42 Thanks for listening.

03:43 Do send in your comments and suggestions.

03:45 I look forward to being with you soon again.

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