We are concerned about the unintended consequences of further encouraging the proliferation of high-deductible insurance plans tied to health savings accounts. This approach is projected to have an adverse effect on the cost and quality of comprehensive employment-based health coverage.Employer sponsored coverage in part grew out of WW-II era wage controls. I can't be the only one that thinks it strange that your health coverage is determined by what occupation you choose, can I? As far as the comprehensive nature of coverage goes, that is not insurance. Insurance is intended to hedge against loss from uncertain events. I believe that including routine care in "insurance" distorts the prices of that care. The burden of those distorted prices hurt the least well off the most.
Affordable group insurance relies on a broad and mixed risk pool. It is anticipatedPeople covered by high deductible plans haven' left the pool of the insured. They have just chosen lower premiums in exchange for higher deductibles. Yes that means they will pay more in the event of medical claims, but in exchange they pay lower premiums. You have to look at both of these together.
that younger and healthier employees will be attracted to the HSA/high-deductible coverage and take their chances.
Older workers, those with families, and others with chronic health problemsI assume "older workers" mean folks not yet old enough for Medicare. In addition to having higher medical costs than, say, a 20 year-old, these folks are likely to earn more, have more savings, and have lower expenses. Additionally, what is the case for a person of average health needing comprehensive coverage? Why can't they plan for some level of medical expenses, just like they would for housing, food, and anything else that you need as part of the natural course of life. Insurance could then be purchased in case of a large claim.
are more likely to need the traditional, comprehensive health coverage. Over the long term, the remaining pool of people in the traditional plans will have higher medical costs, the cost of those plans will soar, and that option will become even more unaffordable for employees who need comprehensive coverage.
I do believe there is gap in the insurance market, but it is not one the AFL-CIO acknowledges here. This is the group of people who we don't expect to have major medical issues, but do. These are the children with cancer or rare genetic diseases and the 35 year-olds in need of an organ transplant. I agree we need to find a way to address these cases as I don't think that anyone in a country as rich as ours should go bankrupt because of their health.
The Obama reform addresses this by simply prohibiting insurers from denying coverage to these folks. How well this will work remains to be seen, but this approach doesn't strike me as particularly transformational.
For the poor we have Medicaid, for the aged we have Medicare. For the vast majority in between, who are largely healthy, an HSA plan could be the right choice. For Wisconsin to handicap these plans through our tax system, when the federal government and so many other states do not, is a backward approach to health care. The Wisconsin AFL-CIO is doing workers a disservice by opposing Walker's tax credit for HSA contributions.