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News of the Day ... In Perspective6/29/2007
HSA enrollments to reach 30 million by 2009, Mintel predicts
A recent report by Mintel International Group Ltd. predicts that Health Savings Accounts will have 30 million enrollees by 2009. A company survey showed that only one-third of respondents would not be interested in an HSA. That proportion was about the same for persons with incomes greater than $100,000 and those with incomes less than $25,000 (Consumer Power Report 5/25/07).
High-income consumers were most interested in tax savings, and low-income workers in access to lower-cost coverage and the ability to pay for things not normally covered by insurance.
Mintel’s research also reveals that consumers are still uneducated about HSAs and their benefits. Fewer than 8.1 million direct-to-customer HSA mail pieces were sent last year, but there was an 89 percent jump in mail volume in the first quarter of 2007 (Business Wire 5/11/07).
Priority Health has produced a 42-page booklet entitled “Health Savings Accounts for Dummies.”
Some labor unions are beginning to recognize the big opportunity offered by HSAs. Manitowoc County, Wisconsin, is installing an HSA program with the reluctant agreement of the AFSCME local. The County will pay the entire premium, fully fund the $3,000 HSA deductible, with 100 percent coverage once the deductible is met. Still, the County will save $1 million in health costs in 2008, while workers will save the $685,000 they had been paying in premiums.
Steelworkers Local 1343 at Bucyrus International has agreed to a consumer-driven health plan. Employees are “happy to be back in control of their health care decisions” and also glad that “health care costs are not dragging companies into the hands of buyout forms or oblivion.”
United Auto Workers should learn from this, writes John Torinus. “[UAW president] Gettelfinger and Chrysler CEO Tom LaSorda could cut a deal for consumer-driven reform forthwith. The bloated health costs would plummet by as much as one-third in short order” (Milwaukee Journal Sentinel 5/19/07).
A study by UnitedHealth Group showed that a large majority (86 percent) of individuals with HSAs carried a balance forward into 2006. The average year-end balance was $761. Among low-income individuals, 80 percent had a balance in the account at the end of a year.
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