Weekly Newsletter: May 5, 2008
Democrat Attacks on HSAs Miss the Mark
This past week, Democrats attempted to use a Government Accountability Office (GAO) report to cast aspersions on Health Savings Accounts (HSAs). The Democrats who requested the GAO report—which analyzed data from HSA contributions made in 2005—asserted that the study proved that HSAs are nothing more than a tax shelter for wealthy individuals.
However, some conservatives may be strongly skeptical of these conclusions, particularly as the report utilized tax data from a year when the number of HSA policy-holders was one-sixth its current level. In addition, many conservatives may applaud the data demonstrating that individuals are building real savings in their HSA accounts to use for health expenses—money that consumers, not insurance companies or government bureaucrats, can control and spend for health care needs.
What is clear is that HSAs have proved tremendously popular in the four years since their introduction. America’s Health Insurance Plans reported Wednesday that more than 6.1 million individuals are covered by HSA-eligible insurance, and that enrollment in HSA plans had increased by 35% during 2007 alone. Given the widespread adoption of this new consumer-directed product, and its impact on reducing the growth of health care costs, many conservatives may object to any Democrat proposals to eliminate HSAs or make them unattractive through unnecessary bureaucratic regulations.
The RSC Policy Brief summarizing the HSA reports can be found here.
Leavitt Speech Highlights Need for Entitlement Reform
Last Wednesday, Secretary of Health and Human Services Mike Leavitt used a speech at the Newseum to advance the cause of Medicare reform, outlining some over-arching principles to guide policy-makers looking to curb the spiraling growth of federal entitlements. In his speech—and a subsequent briefing before RSC Members and staff—he compared the federal government’s looming entitlement obligations as a whirlpool threatening to consume growing amounts of the economy, and advocated for increased competition in Medicare Parts A and B as one measure to stem the spiraling costs.
Many conservatives will support Secretary Leavitt’s call for comprehensive reform, and seek an immediate solution to the problems plaguing Medicare. This year’s Medicare trustees report placed the program’s total unfunded obligations at $86 trillion—which will provide some conservatives with a strong impetus to use all available legislative mechanisms to advance the cause of Medicare reform.
Genetic Non-Discrimination Act Passes Overwhelmingly
Last Thursday, the House by a 414-1 vote passed the Senate amendments to the Genetic Information Non-Discrimination Act (H.R. 493), sending the bill to the President’s desk. The compromise language negotiated between Senate sponsors and Sen. Tom Coburn (R-OK) had previously passed the Senate on a 95-0 vote.
The compromise language corrects several issues of concern to conservatives. Insurers and employers will be prohibited from discriminating against individuals on the basis of fetal genetic information, ensuring that individuals will not feel pressured into aborting their unborn children. In addition, existing policies on insurance underwriting for diseases already manifest in individuals will be maintained, and entities subject to existing privacy regulations under the Health Insurance Portability and Accountability Act (HIPAA) will not be subject to a new regulatory regime. Lastly, the compromise language improved a conservative concern that employers will not be subject to Equal Employment Opportunity Commission (EEOC) tribunals or lawsuits for decisions they make in their capacity as an insurer for their employees.
The RSC Legislative Bulletin on the Genetic Information Non-Discrimination Act can be found here.