HSAs on the horizon

A few more points on CDHC.

The New York Times is reporting on banking industries and their plans to get in on the CDHC gold:

By 2010, more than 15 million Americans, or about 10 percent of all those insured, will have a health savings account, according to an estimate by DiamondCluster International, a management consulting firm.

The average individual's account balance, it projects, will grow from $1,500 today to about $3,500 in 2010. Even if people pull out some or all of their money to pay their medical bills, the ballooning balances may mean that $75 billion or so in new money to manage will soon be at stake.

So here's the thing.  We've already discussed the 80/20 rule, and why HSA's don't make a lot of sense when you factor in the way health costs are distributed.  But we're talking about a substantial period of time to even see HSA's supposed effects if only 10% of the population is projected to have them in 5 years. 

Further, the amount of money in most accounts is projected to be $3,500?  That will barely cover an individual's deductible, and only about a third of a family's.  Looking at those stats, I really can't see how they'll make a dent in actual spending. 

Trends, however, catch on easily.  And the trend of shifting costs to employees is already among us. 

Comments

[marcus newberry]

Ever since large amounts of money began flowing through the health care system and we began to treat "sickness" as a national priority, health care has become the land of economic opportunity, political opportunity, literary opportunity and ego enhancement. HSAs, like health insurance, will do nothing to improve health status or keep people healthy. Bush doesn't know anything about health because he has no one advising him about healthy. It's strange in that he seems to try to pursue a healthy lifestyle.