Entries for November 16, 2006

The lame-duck legislature in Ohio is considering a bill by state Sen. Lou Blessing, a Cincinnati Republican, to require that all public employees be given an option of at least three health savings accounts. My sources tell me that it has an excellent chance of passing and being signed by outgoing Gov. Bob Taft. I have written about health savings accounts on numerous occasions. HSAs were authorized in the 2003 Medicare prescription drug law to work in tandem with health insurance policies with high deductibles; the employee gets money in a health savings account and can retain money not spent. The argument is that HSAs encourage policyholders to weigh the cost of routine healthcare and at the same time protect them from catastrophic expenses. After all, your auto insurance doesn't pay you for oil changes but does pay if your car is totaled. Why should a health insurance policy pay for routine, predictable medical expenses but not cover the full cost of catastrophic care?