EBRI’s Latest on HSA and HRA Balances
From an EBRI Issue Brief by Paul Fronstin:
Asset Levels Growing: In 2011, there was $12.4 billion in health savings accounts (HSAs) and health reimbursement arrangements (HRAs), spread across 8.4 million accounts, according to data from the 2011 EBRI/MGA Consumer Engagement in Health Care Survey, sponsored by EBRI and Mathew Greenwald & Associates. This is up from 2006, when there were 1.3 million accounts with $873.4 million in assets, and 2010, when 5.4 million accounts held $7.3 billion in assets.
After Leveling Off, Average Account Balances Increased: After average account balances leveled off in 2008 and 2009, and fell slightly in 2010, they increased in 2011. In 2006, account balances averaged $696. They increased to $1,320 in 2007, a 90 percent increase. Account balances averaged $1,356 in 2008 and $1,419 in 2009, 3 percent and 5 percent increases, respectively. In 2010, average account balances fell to $1,355, down 4.5 percent from the previous year. In 2011, average account balances increased to $1,470, a 9 percent increase from 2010.Total and Average Rollovers Increase: After declining to $1,029 in 2010, average rollover amounts increased to $1,208 in 2011. Total assets being rolled over increased as well: $6.7 billion was rolled over in 2011, up from $3.7 billion in 2010. The percentage of individuals without a rollover remained at 13 percent in 2011.
Healthy Behavior Does Not Mean Higher Account Balances and Higher Rollovers: Individuals who smoke have more money in their accounts than those who do not smoke. In contrast, obese individuals have less money in their account than the non-obese. There is very little difference in account balances by level of exercise. Very small differences were found in account balances and rollover amounts between individuals who used cost or quality information, compared with those who did not use such information. However, next to no relationship was found between either account balance or rollover amounts and various cost-conscious behaviors. When a difference was found, those exhibiting the cost-conscious behavior were found to have lower account balances and rollover amounts.
Differences in Account Balances: Men have higher account balances than women, older individuals have higher account balances than younger ones, account balances increase with household income, and education has a significant impact on account balances independent of income and other variables.
Differences in Rollover Amounts: Men rolled over more money than women, and older individuals had higher rollover amounts than younger individuals. Rollover amounts increase with household income and education, and individuals with single coverage rolled over a slightly higher amount than those with family coverage.
Apparently, all kinds of factors play into HSA/HRA account balances and rollover amounts.
Looks like alll systems are go.
Some of this makes sense. Men see the doctor less often so their balances should be higher than women. Older people have more income and can anticipate a future with more medical needs so they would naturally accumulate more balances (plus, they’ve had more time to do so).
I don’t get too wrapped up in worrying about who saves; or how much they save; or if they are saving at all; or if they’re spending their money on so-called prevention. If people use less health care because they have appropriate incentives even — if they forgo some services (of dubious value) that public health wonks believe are good — it’s not my place to judge them.
HSAs are clearly a great success story – growing rapidly even after the advent of Obamacare. However, Obamacare is destroying the real point of having an HSA – to control your own health spending.
With the government dictating that the cost of “preventive care” be added to premiums, instead of being left under the patient’s control, and the forthcoming “essential benefits package” that dictates that which much be covered, the ability of the patient to control resources will diminish rapidly.
And don’t get me started on the Medical Loss Ratio (MLR) which is prejudicial to HSAs, because a high-deductible plan will have a “worse” MLR than one with an inefficiently low deductible.
My fear is that HSAs will become what their critics always asserted – just another way for high-income people to shelter their income from taxes. Not that that is in itself a bad thing, but it was not the goal of HSAs.
Looks good to me.
Greg What is your take on these data?
The negative effect on HSAs by the MLR in ObamaCare MUST BE EXPOSED TO THE PUBLIC! With 11.4 HSA accounts on the books, allowing this to happen in an election year is the poster boy for fundamental political stupidity on the part of the Administration. I’m guessing that mostof the 11.4 million accountholders like their HSAs and I am also guessing that most of the accountholders are policical independents ALL THAT IS NECESSARY IS TO EXPOSE THIS FIASCO TO THE PUBLIC (and I don’t mean write to each other abou it). I mean send press releases to Newsmax, Fox News, the Drudge Report, even Limbaugh and Levin, etc. If this gets out AND if people understand that what HHS and company are doing is killing the one health care concept that has actually worked and worked well in reducing the cost of insurance and health care, it will be political suicide. I have been invited to join a grass roots organization on the very topic and I can’t wait. I am a “slasher and burner” anyway about such things!
This is where I degirve the quickest from libertarianism economics which in general I find quite reasonable.The primary reason I don’t go to the doctor today has nothing at all to do with cost, at least, direct economic cost it has to do with the pain in the ass it is to go take a couple of hours out of my day, and then go pick up a prescription […] (I have a ruptured eardrum; and in particular, having to go through these gatekeepers to acquire antibiotics is at least a thrice-yearly chore).When I DO go to the doctor, I need to; and all the personal cost in the world isn’t slowing me down. In fact, my family spent a lot MORE on the first year of our HSA plan than on the last year of the previous company’s PPO (HMO-style).The thing most people don’t admit is that most health care spending is occuring in heroic interventions / expensive maintenance for the very old or the prematurely born. All of the cost/benefit decisions you or I might get pale in comparison to even one month of care for an old person on a respirator.Finally, the fact that many other quite livable countries IN TOTAL spend less than just the amount of PUBLIC money we spent on medical care is particularly compelling. I’m afraid that as I’ve gotten older, I’ve come to the conclusion that there simply is no real way to make medical care market-driven. It simply isn’t going to work.