Health Savings Accounts One Key To Lower Cost Health Insurance

Young people are opting out of health insurance. That is one of the frequently mentioned problems in our health care system that experts discuss.  Young people bring down the cost of insurance for the rest of the population because they do not use it as much as the older segments of the population. When they opt not to purchase policies, it drives up the price for the remaining pool of consumers; who, on average, use the insurance more.

One of the things we should be doing is encouraging younger buyers back into the insurance pool. The Healthcare bill threatens fines and jail time to do that. I prefer positive stimulation. 

The Health Savings account is a medical IRA that was put into law during my time in Congress. It is a retirement account that is usable, tax free, at any age if used to pay for the insurance premium, deductibles, doctor visits or pharmacy costs. A portion of the amount unused in any year stays in the savings account.  It rewards healthy lifestyles and informed health care consumption. As the IRA builds in value, the deductible can be increased which lowers the cost of the insurance.

Health Savings Accounts encourage better choices. Emergency room doctors routinely talk about people who come to the emergency room for minimal problems; headaches, a slight temperature, etc. Costs of the emergency room visits are usually $1,000 or higher. If a person was taking money out of their IRA, they would more properly assess the cost versus the benefit.

One of the things that should be analyzed by experts is the value of offering tax credits for couples with young children to help them pay for insurance. It would be a far better solution than the penalty that is being attempted in the plan before Congress.

Drawing young people back into the insurance market is one of the incremental changes we should be making, rather than the 2,000 pages of massive changes being lumped together in the proposed healthcare reform legislation bills. Changes which will further bankrupt our nation.