Expanding 21st Century Healthcare Coverage in Georgia Affordable Health Care Coverage for All: Information Rich Health Savings Accounts as a Key Step
The historic health savings account (HSA) legislation that the Congress passed as a part of the Medicare drug legislation is an extraordinarily important first step in the transformation of the American health and health care system that will save lives and money. The Center for Health Transformation has made the rapid adoption of HSAs one of its top priorities in 2005 and launched a Health Savings Account Project to coordinate activities in support of this priority.
These portable accounts will allow individuals to deposit money tax free, grow money tax-free, and to withdraw that money tax-free to pay for qualified medical expenses, including preventive care, health insurance deductibles, health insurance premiums for retirees, prescription drugs and long-term care services (including long-term care insurance). As such, information-rich HSAs, which are owned by individuals, are the first completely tax-free account in American history. They will begin to move us away from the current model in which insurance companies dominate the health care transaction. Instead, the information-rich HSA will enable transactions between doctor and patient in which the patient controls how dollars are spent.
In addition, the Center believes that it is vitally important that the information-rich HSAs offered by insurance companies be accompanied by information rich decision support and health management tools that will increase the ability of individuals to make intelligent decisions about the spending of their health dollars. Such decision support tools include price and quality information about doctors, hospitals, prescription drugs, and chronic care services. Health management tools include extensive information about an individual’s health condition and treatment and management options. Many insurance companies already offer robust decision support and health management tools. With the introduction of information-rich HSAs, the Center believes that these tools will increase in user-friendliness and sophistication as more and more consumers with a first dollar interest in their health spending will demand more and better information about how to spend it wisely.
HSA eligible High Deductible Health Plans (HDHPs) have a preferred status in federal tax law. HSAs have triple tax advantages:
- Contributions are direct reductions from taxable income,
- Interest earnings are not taxable, and
- Withdrawals for healthcare expenses are not taxed.
Georgia can become the first state in the country to take full advantage of the fastest growing form of health insurance - Health Savings Accounts (HSAs).
Mission
Accelerate the adoption of solutions and policies that will improve health, lower the costs of healthcare, reduce premiums for individual and small group health insurance, and decrease the number of uninsureds.
Vision
Create a market-based solution that provides access to health insurance for all Georgians with care provided in a 21st Century Intelligent Health System.
Goal
100% insurance coverage through market-based solutions, private/corporate efforts, tax incentives, direct public subsidies, strong community support, and faith-based outreach programs.
