In the course of writing my piece on McCain's health care bill, I ended up diving deep back into the muck of Health Savings Accounts. HSAs, for those not yet acquainted, are the current conservative panacea for all that ails our health system: They are high deductible, low premium insurance plans that offer a tax sheltered account where folks can sock away money with which to pay their high deductibles. The idea behind them is simple: If we pay directly for more care, we'll buy less of it, either because we can't afford the care or because we decide to spend the money on something else. Implicit in that argument is the idea that we, as individuals, will know which care is worth buying and which care is worth skimping on. But, of course, we don't know that. So instead, HSAs ask for a much cruder economic calculation: Do you think you'll need care or not? If you do think you'll need care, you're better off with traditional insurance, which pays for you to get care. If you don't think you'll need much care, an HSA might be the way to go, as your premiums will be lower. As I put it in my article on McCain, they're the logical extension of our absurd system: HSAs are health coverage for people who don't need health care. But I left out one group who also find HSA's useful: The rich. Check out this graph from a GAO report examining who actually uses the accounts:
According to the report, "the average adjusted gross income for those reporting HSA activity in 2005 was about $139,000, compared with about $57,000 for other filers." To be fair, some of that probably reflects the fact that HSAs are a fairly new product and early adopters are probably high education, well-to-do types. But in a broader sense, this is to be expected. HSAs -- which reduce your financial protection from health costs -- are a perfectly good option if you don't really need financial protection from health costs. So they're more popular among the rich. Maybe I'll amend my statement above: They're health insurance for people who don't expect to need health care and don't need insurance to help pay for health care.
According to the report, "the average adjusted gross income for those reporting HSA activity in 2005 was about $139,000, compared with about $57,000 for other filers." To be fair, some of that probably reflects the fact that HSAs are a fairly new product and early adopters are probably high education, well-to-do types. But in a broader sense, this is to be expected. HSAs -- which reduce your financial protection from health costs -- are a perfectly good option if you don't really need financial protection from health costs. So they're more popular among the rich. Maybe I'll amend my statement above: They're health insurance for people who don't expect to need health care and don't need insurance to help pay for health care. 
