Former Senate Majority Leader Tom Daschle's decision Tuesday to withdraw as nominee for secretary of Health and Human Services was a setback for President Obama's goal of reforming the U.S. healthcare system.
What could that mean for you? Three words: health savings account.
As healthcare costs for employers continue to soar, and as hopes fade for quick relief from Washington, a growing number of businesses are expected to stop offering costly insurance benefits and push workers instead into tax-free health savings accounts.
Proponents of the accounts, which operate like 401(k)s for medical expenses, say they give people more control over their healthcare spending. They also say people become savvier medical consumers when they're more aware of the costs of treatments and procedures.
Critics of health savings accounts counter that the plans favor the healthy and wealthy, and can increase medical costs for everyone else by requiring people to take out high-deductible insurance policies that kick in only after thousands of dollars in healthcare expenses have been rung up.
"Most people can't even afford to put money into the account," said Jerry Flanagan, health policy director for Consumer Watchdog in Santa Monica. "All the money goes into premiums and deductibles."
Health savings accounts were introduced five years ago as an alternative to traditional employer-based health coverage. Although they were championed by former President Bush as a way for Americans to exercise more control over healthcare spending, most employers have been wary of embracing them.
According to a recent report from the Government Accountability Office, only about 2% of the more than 200 million Americans with private insurance have opted for health savings accounts.
But market researcher Diamond Management & Technology Consultants predicted in a report last month that as many as 10 million Americans would be enrolled in health savings accounts by next year, or about twice the number in 2007.
Larger employers remain wary of saddling workers with high-deductible insurance plans, Diamond found, but smaller businesses are increasingly turning to health savings accounts as a way to ease runaway healthcare costs.
"Small employers want to do the right thing," said Karen Pollitz, a research professor at Georgetown University's Health Policy Institute. "They want to provide healthcare. But each year they have less money."
