Aaron Carroll and Austin Frakt relate the problem:
Over the past decade, the number of reimbursed eyelid-lift procedures has tripled. The cost to taxpayers has quadrupled, to $80 million from $20 million.
Medicare traditionally avoids coverage for cosmetic procedures such as Botox or breast augmentation (except after medically necessary breast removal). So why cover eyelid lifts? It’s possible that more of the elderly are suffering real vision problems in need of corrective surgery.
But is it likely that a disproportionate number of these patients live in one state? More than half of the 20 highest-billing physicians were in Florida, where one doctor submitted for 2,200 eyelid lifts in 2008 alone.
Their solution: better Medicare oversight.
My solution: Get Medicare completely out of the business of eyelid lifts. Let patients pay for all such procedures from their Health Savings Accounts.
Senators Orrin Hatch (R-UT) and Marco Rubio (R-FL) have introduced legislation to eliminate many of the restrictions currently placed on HSAs and FSAs. For instance, the bill would allow HSA accounts to be used to pay health insurance premiums. The bill allows eligible spouses 55 and older to make HSA catch-up contributions to the same HSA account and it allows Medicare beneficiaries to contribute to HSAs after age 65. Also, Medicare beneficiaries in an MSA plan will be able to contribute their own tax-deductible money to their MSAs.
Across-the-board deductibles don’t make a lot of sense. In Priceless, I argued that whole categories of care should be transferred to the patient in some cases and there should be first-dollar coverage for other kinds of services. Austin Frakt seems to agree, reproducing this graph from the book, and remarking:
LASIK is an elective procedure, the purpose of which is well understood by the patient. I’m on board with the idea that insurance shouldn’t cover such things, or if it does, not the full cost and certainly not the marginal cost. All health procedures just like this are good candidates for the purview of John Goodman’s “New HSA.”
The issue is not whether the procedure is like LASIK surgery, however. The issue is whether choices by the individual will create costs for other members of the insurance pool. Where there are no “financial externalities,” the case for individual decision-making is strong.
The growing prevalence and amount of deductibles has resulted in an increasing percentage of covered workers enrolled in a plan with high deductibles. In 2012, about a third (34%) of covered workers were enrolled in a plan with a deductible of a $1,000 or more compared to 10% in 2006, and 14% were enrolled in a plan with a deductible of $2,000 or more compared to 3% in 2006. The percentages of workers include workers who are enrolled in a high deductible plans with a savings account (HDHP/SO), such as an HSA or an HRA, and those who are in a plan without a savings account.
Source: Kaiser Health News.
Almost a quarter of Americans have less than $100 in their emergency savings fund, according to a recent TNS survey for CashNetUSA. Of the 1,000 participants surveyed, a staggering 22.8 percent reported that if they needed to cover an emergency expense within one day, they would have less than $100 available.
Both males and females reported similar savings patterns, however, 55 percent of Americans with children under the age of 18 reported having less than $800 in emergency savings compared to 42 percent of those without.
Source: It’s Economic.
The Kaiser Family Foundation conducts an annual survey of employer-sponsored health plans. According to the 2012 survey, one-third (31 percent) of firms that offer health coverage offers a consumer driven health plan (CDHC) option. Approximately one-in five covered workers are in CDHC plan. Eleven percent of covered workers are in a Health Savings Account-qualified (HSA) plan in 2012 — up from 9% in 2011; while 8% are in an HRA plan in 2012 — about the same as in 2011.
About 149 million people are covered through an employer health plan. The report didn’t break down HSAs/HRAs by the number of people enrolled. But the data suggests that as many as 28 million people may be in an employer HRA/HSA plan.