Back to Annual Meeting Page		American Public Health Association 133rd Annual Meeting & Exposition December 10-14, 2005 Philadelphia, PA

Abstract #120125

J. Warren Salmon, PhD, Department of Pharmacy Administration, University of Illinois at Chicago, 833 South Wood Street (MC871), Chicago, IL 60612, 312.100.1000, jwarrensalmon@msn.com

Health savings accounts (HSAs) have been around since early 1990s as the consumer-driven health plan. The basic idea is the combination of a tax-free saving account and a high-deductible health plan (at least $1,000 for individuals and $2,000 for families). People can set up HSAs through their employers, and both employers and employees can make tax-free contributions to the accounts up to 100% of the maximum deductible each year. Employees can use the accounts to cover most of their health expenses, though they have to pay incurred charges out of their own pockets if their HSAs are depleted, but the total expenses still don't meet the deductible. Once the qualified spending reaches the deductible amount, the high-deductible health policy will cover all the extra expenses. If the employee doesn't use up all the money in the HSA, the remaining balance may roll over to the next year. As long as the expenses from the HSA comply with IRS requirements, there is no tax on the spending.

Advocates of HSAs believe that if people can shop around for medical insurance products and providers for their health needs and are tied with health care costs directly, they will become more cost-conscious and make medical decisions wisely. Thus, not only their satisfaction on health care can be ensured, but also health care expenditures can be contained by reduction of unnecessary services; this is the theory to increase of market competition among providers.

Learning Objectives:

• See abstract

Presenting author's disclosure statement:

I wish to disclose that I have NO financial interests or other relationship with the manufactures of commercial products, suppliers of commercial services or commercial supporters.