I’m as anti-Bush as the next guy, but HSA’s are a good idea, at least until the entire system is overhauled.
Any more, people don’t understand is what (conceptually), health insurance is and what it used to be. Health insurance is supposed to first and foremost protect us against large financial burdens associated with medical/health problems.
Yeah, yeah, flame me for not saying it’s about protecting us first and foremost from health problems… but you know what? People need to protect themselves first and foremost. If you have a medical problems, or you “need” to take prescriptions, why on earth would you let something like MONEY get in the way of that?
Oh yeah, because it might mean sacrificing the other nice things you have, like the car you drive, or nice house you live in.
Those who are healthy and/or don’t need these things (yet) are motivated to continue living a healthy lifestyle (and, I guess, so to are those who are already in need). Hopefully parents/the system/schools, encourage their children to do the same, via excersice, better diets, etc.
Anyway, back to my point – over time, the perceptions people have of what health insurance is and what it used to be has changed. Today, health insurance is nothing more to most people than the ID Card sitting in their wallet or purse, entitling them to medications for the price of a happy meal or doctors office visits that (gasp!) cost $30 with a copay.
Without the HSA, you’re (or you plus employer, or just employer) are STILL PAYING for the full cost of the medications and the full cost of the doctors office visit (and associated costs) with the PREMIUM associated with those plans as they renew with 40%+ increases every year.
With the HSA, you can not only act as a consumer, but they let you do it with tax-deferred money. I can’t put aside money in a tax-sheltered account to buy groceries, or for a gym membership, or for car tires.
Also, to the O.P., the law has limits to annual maximum out-of-pocket costs associated with the HSA. There’s no way you’re paying 10% of the next $98,000 on a claim like that. As already mentioned, most HSA’s-qualified insurance plans come with 100% coinsurance after the deductible, but even if you have coinsurance after the deductible, there will be something called the stop-loss limit that gives you a maximum out-of-pocket cost. Again, with most plans having 100% coinsurance, the out of pocket maximum is usually less than typical PPO plans.
I have an HSA myself. $1700 deductible. My old plan was up to $160/mo, new HSA plan is $68 a month. I put the difference each month into the HSA, and after a few months I can actually see myself going to the dentist (and using the HSA money for it) or for a check-up if I need it (wellness/routine benefits can still be paid first-dollar). If I (or if I ever had kids) ever need to go in, I’m not going to let the balance in my HSA stop me from going.
Then come tax time, I can write off the contributions. I know what my total exposure for the year is, and I FACTOR THAT INTO my lifestyle: what I buy and what I don’t, etc.
OK I’ll stop now.