All of Washington's pre-SOTU, fortune-cookie articles are indicating that Bush is going to make promotion and popularization of Health Savings Accounts a centerpiece of both the speech and his 2006 agenda. Alrighty. We can argue back and forth about whether HSA's are good policy. I'll choose door number "No", though, admittedly, there are interesting elements to the concept and policies encouraging patients to become more involved and educated about their health care decisions would, if done humanely, attract my support. But it's rather poorly understood what bad politics they are.
I made this point a couple days ago and Krugman (sorry Kevin), in a column cleverly entitled "First, Do More Harm," makes it today (if you've got Times Select, it's well worth a read). HSA's is an explicit reaction against rising premiums, deteriorating employer coverage, and higher out-of-pocket payments. So the Bush administration's answer to these concerns is popularizing a set of policies that accelerates cost-shifting, allows more employers to cease providing comprehensive care, and ensures higher out of pocket payments. They're just praying no one notices.
Policy, however, matters. The Bush administration's hope is that pushing a complicated, buzzwordy health care solution will convince Americans that they have a plan even when the actual policy solution is a pat on the back to every trend and practice voters are screaming out in protest against. But the Bushies tried this once before, with Medicare. There, they approached an issue with great superficial politics but addressed it with laughable, Keystone-Kops-style policy. And, sure enough, as the speeches have given way to enrollment periods, Medicare Part D has emerged a marquee issue for every "D" associated politician. The same will happen with HSA's.
HSA's, in an attempt to encourage healthier behavior and less treatment, are explicitly designed to hike out-of-pocket costs. Whether the political standoff evolves as Social Security reform did, with the policy's dangers crystallizing before its implementation, or whether it follows the path of Medicare, when their effect comes clear, HSA's will be be about as popular as a gas tax. Republicans would be lucky to have them rejected in Congress, which would be little more than a political black eye. Because if they enter wide use, doing exactly what they promise to do, the eventual backlash will detonate both the majority that voted for the bill and the brave, new world of health insurance it ushered in. The Bush administration wants to have it both ways: populist politics and corporate policies. But while that works fine for sneaky regulatory changes and legislation that only glancingly impacts the lives of most voters, it's not the sort of game you can play with health care. The Bush administration, i'd wager, is soon to find that out.