In a June 2022 article, experts argue that health savings accounts (HSAs) have failed to deliver on their promises and propose abolishing them as tax-favored accounts. However, they suggest transforming HSAs into tools that facilitate better, cost-effective care, particularly for managing chronic illnesses. Click here for article.
HSAs allow pre-tax savings for medical expenses, but their tax benefits disproportionately favor higher-income individuals, raising concerns about regressivity.
Experts advocate for redesigning HSAs to support chronic illness management, allowing health plans to contribute funds for patients willing to self-manage their care.
Current laws impose strict high-deductible requirements on HSAs, limiting their effectiveness; reforms could enable plans to provide more tailored coverage options.
To enhance HSAs, proposals include allowing them to fund direct primary care and integrating them into ACA exchanges, while also considering Roth-style HSAs for seniors.
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