HSA enrollment growth slows but is still high

New industry numbers show more than a quarter of people with the accounts were previously uninsured. But an article questions the products' value for women.

By Doug Trapp — Posted May 14, 2007

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More than 4.5 million people have enrolled in insurance plans offered with health savings accounts as of January, an increase of 1.3 million over the previous year.

The estimate comes from the third census of insurance companies by America's Health Insurance Plans. The survey included 87 responses, or about 95% of the firms offering such plans, said AHIP Senior Vice President Mike Tuffin. The report does not include enrollment under health reimbursement arrangements, a different kind of tax-advantaged account.

The results counter arguments that HSAs, which allow tax deductible contributions for health spending, attract only the young, healthy, wealthy or already insured. About 46% of the 1.1 million individual market enrollees were 40 years or older, AHIP found. Also, 27% of the enrollees were previously uninsured.

"So it's clear that HSA plans are helping people access coverage for the first time," Tuffin said. Numbers were not available for the group market.

Although HSA-qualified plan enrollment grew by 43%, it didn't expand as quickly as it did between January 2005 and January 2006, when membership climbed by 2.2 million, or 220%. "Nothing is going to grow at 200% forever," Tuffin said.

AMA policy supports HSAs as one part of its broader health system reform campaign.

On the other side of the debate, an analysis suggested that these plans are not good for women because they spend more on health care than men.

The median amount insured women 18 to 44 years old spend on health care is $1,266 per year, compared with $463 for men in the same age range, according to an article co-authored by Steffie Woolhandler, MD, MPH, an internist and associate professor of medicine at Harvard Medical School in Boston. She is a co-founder and board member of Physicians for a National Health Program, a single-payer advocacy group.

High-deductible plans lead to higher costs for women, Dr. Woolhandler said. HSA-qualified plans have a minimum individual deductible of $1,050. About 31% of men between the ages 18 and 44 reach that level of spending, compared with nearly 57% of women, found the study, "Consumer Directed Health Care: Except for the Healthy and Wealthy It's Unwise." The findings will be published in the June Journal of General Internal Medicine but are available online. The analysis was based on the 2003 Health and Human Services' Medical Expenditure Panel Survey, adjusted to 2006 dollars.

The AHIP census found that more than 90% of plans paired with HSAs offer options to cover some care before the deductible is met. Dr. Woolhandler said the coverage isn't meaningful because it might pay for only one or two visits to a doctor annually.

Another report found that consumer-directed health plans -- a blanket term for high-deductible plans paired with HSAs or other products giving consumers more control over spending -- lead to decreased prescription drug use. The study was released last month by pharmacy benefit manager Express Scripts. It analyzed nine months of drug purchases by employees of two large financial service companies. The report found that CDHP enrollees reduced their brand-name drug buying by 13% to 14% without a corresponding increase in generic drug purchases.

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Newly minted

A recent survey of health savings accounts found that most had less than $1,000 in them and most had been open less than a year. The estimates are based on about 350,000 accounts.

Average balance, 2006
$0 14%
Less than $1,000 55%
$1,001 to $2,500 19%
$2,501 to $5,000 8%
$5,001 to $10,000 3%
More than $10,000 1%
Total 100%
Average account age, as of January 2007
6 months or less 26%
7 to 12 months 39%
13 to 18 months 24%
More than 18 months 11%
Total 100%

Source: America's Health Insurance Plans

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External links

"January 2007 Census Shows 4.5 Million People Covered By HSA/High-Deductible Health Plans," America's Health Insurance Plans, in pdf (link)

"Consumer Directed Healthcare: Except for the Healthy and Wealthy It's Unwise," Journal of General Internal Medicine, online, in pdf (link)

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