Is revenue drain the cost of coverage portability?(Health Savings Accounts)

Publication: Medicine & Health

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COPYRIGHT 2003 Thomson Financial Inc.

One--of several--remaining high hurdles to enacting Medicare prescription-drug legislation is a House provision that would greatly expand the use of tax-favored savings accounts to pay for medical expenses. The accounts--christened health savings accounts--would replace and expand the current limited medical-savings-account program, a move some analysts say could have significant consequences for federal revenue, as well as for the structure of health coverage.

HSA enthusiasts--mostly Republican conservatives--want any Medicare overhaul enacted this year to pave the way for a new system-wide health-coverage model in which an individual owns a portable coverage vehicle, for life, including a means to save money for retirement health expenses. They view HSAs, which would be offered in combination with catastrophic health-insurance policies, as a significant, highly desirable step in that direction.

Individuals and their employers could make tax-deductible annual contributions...

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