America’s Health Insurance Plans (AHIP) recently released the result of their annual census survey regarding Health Savings Accounts (HSA). Survey showed that the number of enrollees in high-deductible health plans linked with HSA plans surged by 14 percent this year. From January 2008 wherein only 6.8 million Americans enrolled in HSA health plans, the number of enrollees has nearly doubled in January 2011.
Approximately 11.4 million Americans are now covered with HSA plans. Statistics show that HSA enrollment significantly rose in the large-group market (26 percent) than in the individual market (15 percent). Employers having 50 or more employees had 6.3 million people in HSA health plans in Jan. 1, 2011. However, HSA enrollment in the small-employer market dropped by 7 percent (2.8 million).
Since 2004, when Health Savings Accounts were introduced to the market, enrollment has risen steadily and significantly. As stated by Karen Ignagni, President and CEO of AHIP, “HSA plans continue to be a vital source of affordable coverage for millions of families and employers across the country.”
Percentage Of HSA Enrollment In Different States Revealed
Census also showed which states had the highest and lowest percentage of HSA enrollees younger than 65 with private health insurance.
Minnesota ranked first with 14.9 percent. Minnesota is then followed closely by Vermont with 11.4 percent and Colorado with 11.3 percent.
States with the lowest percentage of HSA plan enrollees are Hawaii (0.2 %), West Virginia (2.1%) and Mississippi (2.4 %).
According to numerous surveys, HSA growth can be attributed to the low premiums of high-deductible health insurance plans compared to the traditional health insurance plans.
Are HSA Plans Threatened By The Affordable Care Act?
Robert Zirkelback, AHIP’s spokesman, said that despite the growth in HSA plans, the association is still worried about the Affordable Care Act’s impact on Health Savings Account plans.
The Affordable Care Act was made in an attempt to provide healthcare coverage to millions of uninsured people. However, it also imposes certain restrictions on insurers. In particular, Zirkelbach stated that HSA plans could be threatened by a new rule under the healthcare reform law that requires insurers to spend a certain percentage of premiums on medical care or offer refunds to customers.
Aside from that, HSA funds can no longer be used to buy over-the-counter drugs without a prescription coming from your doctor. This particular restriction reduces the consumers’ access to common over-the-counter medications, and instead promotes the use of higher-cost prescription drug options.
Enrolling In Health Savings Accounts Can Still Give You Numerous Benefits
Despite the current changes in Health Savings Accounts, these plans are still being embraced by consumers.
Employers have shown great interest in HSA plans to combat skyrocketing health care expenses and to make their workers more aware of the costs. The contributions placed by your employer are also helpful in reducing the tax amount that they need to pay. In addition, the HSA contributions made by your employer are yours to keep even if you decide to leave or retire from the company.
Since HSA plans are paired with high-deductible plans, you get to pay lower monthly premiums than full coverage plans. To get an HSA-linked health plan, the minimum deductible for individual coverage is $1,200 and $2,400 for family coverage.
The money you place in your HSA earns tax-free. What’s even better is that withdrawals made to pay for qualified medical expenses are not subjected to tax either. Once you reach 65 and above, all the withdrawals you make are tax deferred. In addition, the unused money rolls over every year just like an IRA.
Despite the changes in Health Savings Accounts, a high-deductible health plan combined with an HSA can help you save with low premiums, lower taxes and tax-free savings.
I recently put the word “health” into the Google search engine. The search returned 1.32 billion web pages where the word “health” was mentioned. I do really mean the number 1,320,000,000 – more than 1.3 billion mentions. I followed up with other words. “Money” found 1.2 billion pages and “sex” 819 million. What an amazing statement about the popularity of health on the net – more mentions than sex and money! And numbers of references that are in the billions. When I did this same search in 2000, there were 27 million “health” references so this is more than a forty fold increase in the past 8 years. What an expansion of interest in health on the Internet.
The business of eHealth on the Internet is expanding rapidly. Two recent reports from the Pew Foundation and Harris Interactive have confirmed that 75-80 per cent of United States Internet users utilize the Internet for health information and healthcare – that is around 140 million people. This is over 65% of the entire adult population of the USA – an average of 8 million people every day! Not surprisingly those individuals with chronic illnesses, who have recently been diagnosed with a medical condition or who have broadband Internet connections use the Internet for healthcare more commonly than other Internet users, and their searches for health information are becoming a regular habit, often several times per month.
Business sees the healthcare sector as a particularly attractive industry that will benefit from web-based technologies because of its enormous size, inefficiency and information intensity. Moreover, the healthcare industry is particularly fragmented with a large number of participants, including general practitioners and primary care clinicians, specialists, institutions (public and private hospitals and diagnostic companies), health funds, pharmaceutical companies, retail pharmacies and, of course, patients.
John Chambers, from Cisco Systems, has been quoted many times as saying that “the Internet waits for no-one”, and now that we have the rise of what is being called the second Internet revolution, with the influence of social networking and sites like Facebook, Twitter and YouTube, the importance of the Internet has increased dramatically as it has entered the social fabric of our lives. We know that the radio took 30 years, and the TV 15 years, to build an audience of 60 million people around the world. The Web won 90 million people in its first three years and hasn’t looked back so that there are now well over one and a half billion Internet users around the world – 23% of the entire population of the world.
Countries like China, and regions like South America and the Indian subcontinent, with their large populations and economic bases, are becoming significant powers in the Internet world. I visited India in 2003 and while driving along the main road from Agra to Delhi was astonished to see broadband fiber being laid in hand dug trenches alongside the roadway, and to learn from my driver that this was now commonly seen as the whole of India was being rapidly wired.
Many forces enable the practice of Internet healthcare to advance rapidly, including the following:
1. Consumers are spending more of their own income on health, with an estimated increase in cost of 2.5% to 3.5% per year as the population ages.
2. Consumers are being encouraged to take more responsibility for their health, and to know more about treatments offered for them, their effectiveness and the track record of the individual provider or medical team offering the treatment.
3. It is well known that conventional health services are associated with many unintended injuries or complications, and government task forces in the United States, Europe and Australia have all strongly recommended more information technology involvement in the healthcare system to reduce errors and mistakes.
4. Health practitioners are now generally highly computer literate, and the medical students of today have grown up in a world where they have never known of life without the Internet. Many doctors have their own homepages, and the culture of health is changing. It is now well understood by both patients and doctors that patients can drive their care through accessing good quality information.
5. The spread and increasing access to fast Internet connections via broadband has led the whole internet to become so much more accessible than was the case when most people connected by dial up. It is now a major force in our daily lives.
6. Major publishing companies have developed substantial healthcare Internet programs, and Google and Microsoft have recently entered the health industry with a bang, both focusing on building personal health records for patients, and working with premier health organizations, such as the Cleveland Clinic.
The presence of “health” on the Internet, as one of the most popular and generic search terms used on Google, is massive. It is easy to see why this term is more popular than “sex” or “money” when you examine all the forces driving Internet healthcare. The challenge for consumers is to sort out good quality information, from biased and inaccurate sources.