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GAO REPORT ON HEALTH SAVINGS ACCOUNT

September 13, 2006

BenefitsBlog notes a new GAO study, "Early Enrollee Experiences with Health Savings Accounts and Eligible Health Plans."

The plans report that most people with HSAs are using them the smart way - to build up savings for use against the high deductibles when needed:

About 45 percent of tax filers reporting 2004 HSA contributions also reported that they withdrew funds in 2004, and 90 percent of these funds were withdrawn for qualified medical expenses. The other 55 percent of those reporting HSA contributions in 2004 did not withdraw any funds from their HSA in 2004.

The study was written for Max Baucus, ranking minority member of the finance committee. He, like other opponents of HSAs, is likely to tout this from the study:

HSA-eligible plan enrollees who participated in GAO’s focus groups generally reported positive experiences, but most would not recommend the plans to all consumers. Participants enrolled in the plans generally understood the key attributes of their plan. Few participants reported researching cost before obtaining health care services, although many researched the cost of prescription drugs. Most participants were satisfied with their HSA-eligible plan and would recommend these plans to healthy consumers, but not to those who use maintenance medication, have a chronic condition, have children, or may not have the funds to meet the high deductible.

This "focus group" stuff is pretty lame. A focus group can be led anywhere the moderator wants it to go. The group generates no statistical data that can be reviewed, so there's no way of knowing whether the report's author is drawing valid conclusions. The conclusion is internally contradicory - everybody seemed happy with their own HSAs, but they wouldn't recommend them "...to those who use maintenance medication, have a chronic condition, have children, or may not have the funds to meet the high deductible." That means they wouldn't recommend them to... most people. It works for most of us, but it won't work for everybody else? Hard to believe.

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