ObamaCare Threatens HSAs

The Supreme Court has green-lighted an onslaught of government regulations, new taxes, and bureaucrats who will have a profound impact of the lives of millions of Americans. One of the first casualties, however, might be the millions of Americans with individual Health Savings Accounts (HSAs).

A little known regulation proposed by the Department of Health and Human Services (HHS) is threatening the growth of the HSA market and could result in the demise of the individual HSA market should it not be reversed.

HSAs are the free market alternative to government-run health care, and their popularity causes misery to proponents of ObamaCare. Nearly 13 million Americans have HSAs, making it the fastest growing health care product in history. Of the 13 million, five million are individuals who have purchased HSAs outside of large employers. HSAs work because they are consumer-driven and give leeway to consumers to choose their own doctor and treatment. Because HSA users can roll over money in their account at the end of the year, many become shoppers for health care, comparing prices and services. This creates a competitive market that lowers the price of health care.

Government bureaucrats in the Obama Administration are not fans of HSAs, to say the least. Many believe new regulations proposed by HHS are a scheme to limit or reverse the growth of the HSA marketplace.

Proposed HHS regulations called “Medical Loss Ratios” (MLR) discriminate against HSA-qualified health plans by not allowing medical costs incurred by the patient below the deductible to be accounted for in the MLR formula. These regulations could destroy the personal HSA market and undermine President Obama’s pledge to allow people who like their current health care plans to keep them.

Health Savings Accounts could be the first casualty in the government’s desire to run our health care system. It is critical for HSA supporters and account-holders to take notice and be counted. The time has come to act.

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