HSAs: Efficient Heath Care and Savings for State Taxpayers
A recent op-ed by Indiana Governor Mitch Daniels in the Wall Street Journal highlights the benefits his state has seen since implementing an optional Health Savings Account (HSA) for public employees. By providing a pre-paid $2,750 HSA, of which the employee had full ownership, the Hoosier state quickly began to realize its potential.
An essential ingredient contributing to the program’s success was that employees keep whatever funds were left in an HSA at the end of the year. This incentivized employees to eat right and practice healthy habits, giving them more money in their pocket. The average amount left in the account at the end of the year was around $2,000 per person.
Overall, the state will save roughly $20 million due to their HSA enrollment, which is currently around 70% of all state workers. In 2009, employees with HSAs visited the emergency room roughly 67% fewer times than those employees on the traditional plans, and had a lower average prescription cost by opting for generic medications.
Instead of pushing for greater government control in health care, politicians in Washington should turn to the “laboratory” of the states for sound solutions.