What is Happening with HSA Type Health Plans?
Author: Richard Day

In the last couple of years, Health Savings Plans, (HSA)
have been more widely accepted than in any years in the
past. HSA plans were introduced on January 1, 2004, but
they really were confusing to most agents and therefore,
they were confusing to most of the buying public.

What has caused HSA plans to become more popular? There are
many reasons, of course, but here are some of the more
important ones:

* Agents have been properly trained
* Customers have experienced large increases in their
traditional copay type plans
* Doctors are much more familiar with the HSA plans and
their benefits
* Hospitals, drug stores and other providers understand
them better
* Certified Public Accountants and financial advisers are
explaining the benefits to their clients
* HSA type plans are much less expensive than copay plans -
especially if you equate risks

In 2007, in North Carolina, there were two flu seasons. It
is unusual to have two flu seasons in one year. Most years,
one flu season is all we will have. Because people with
copay plans like to get their money's worth, they visited
the doctors more frequently.

Their thinking is along these lines...I spend X dollars per
month on my health insurance, and I hardly ever use it. It
only costs me $15, or $25, or $35, copay to go see a doctor
and get help. Why wouldn't I take advantage of the plan I
have paid for?

Consequently, the doctor visits and drug prescriptions for
the year were almost doubled. The insurance companies had
factored in a certain, normal number of doctor visits and
drug purchases per year in the cost of their plans. When
they found that people used the plans much more than they
had calculated they would, they had to raise the premiums.
Depending on your age, and the plan that you had purchased,
the increases were in the range of 20% to 35%. That was a
shock! People know that they need health insurance, but
this was getting so expensive, they were worried that they
couldn't sustain those increases. Many people investigated
how they could cut their costs. The HSA plan was suggested
as a solution by many informed agents.

Now, for the surprising part:
HSA type plans' premiums went up about 4 to 7% depending on
your age and the plan you were on. Why the large difference?

Here is the line of thinking of someone who has an HSA type
plan:

They have bought the insurance to be catastrophic coverage.
They will personally take care of the small costs like
doctor visits, drugs, and other expenses of that type.
However, if they have something catastrophic happen to them
such as a car accident, cancer, heart problems, and the
list goes on, then they want a solid, secure, insurance
company to carry those costs. Bankruptcy is not in their
plans.

Therefore, when they got the flu, they were more reluctant
to go to the doctor... it was going to cost them about $50
or $60 out of pocket to see the doctor. They thought, well,
let's see. It has been a week so far...if my conditions
haven't improved in a couple of weeks, I will go see the
doctor. (This is just what several families have reported.)

Since the insurance companies where not affected very much
by people on HSA type plans, they didn't have to raise
their premiums much.

In summary: People who purchase HSA type plans pay less
every month to protect themselves and their families. They
have catastrophic coverage that will protect them from
large losses. They understand that the best, most
economical use of insurance is to cover the catastrophic
event.


About the Author:

Health Savings Account (HSA) type plans are becoming
increasingly popular. Learn how you can cut your costs of
health insurance. Investigate the true catastrophic plan.
Here is a video to watch that explains quickly how they
work: http://richdayhealthplans.com/blog/?p=40