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Health savings accounts can solve healthcare problems

Whenever a vote comes up on a healthcare bill, many Democrats across the nation frame those who vote for reform bills as heartless egotists who want to take healthcare away from the American people. This could not be further from the truth. In order to lessen the financial impact health insurance companies bear as a result of the Affordable Care Act (ACA) and to help reduce rising premiums, a decrease in the number of health conditions that are covered, along with an increased prevalence in health savings accounts, is needed.

When you sign up for health insurance, the company insuring your health is contractually obligated to cover the cost of whatever they said they would cover in your personal health plan. If enough people sign up for health insurance and pay the monthly premiums, theoretically the health insurer now has enough revenue to cover everyone they are insuring. This is assuming not everyone they cover is going to the doctor once a week. Most people health insurers cover also hardly ever have serious health emergencies, such as an unplanned surgery to remove skin cancer. This is why insurers are able to offer such robust health care coverage, meaning they will pay a large portion (if not 100%) of the cost for a wide variety of procedures. This is how the health insurance marketplace is supposed to work.

Say that a ton of unhealthy people start signing up for health insurance. These people are labeled as “high utilizers” in the healthcare industry. Now, there are an increased number of people that the health insurer must pay health care costs for. If there are enough healthy people who have signed up for health insurance and are paying the monthly premiums, this influx of high utilizers should not have that much of an impact. Ironically, this is not the case. Slews of high utilizers signed up for health insurance during the ACA years at a far higher rate than the lower utilizers, also known as healthy people.

Since millions more unhealthy Americans now have health insurance, health insurance companies are now obligated to cover all of their applicable numerous health care costs. The only way to have enough money to pay for the increased costs is to also increase the monthly premiums everyone is paying. The only other option is to increase the federal subsidies the government is giving health insurance companies; the same government that’s already operating on a deficit.

The Republicans in the federal government have heard the cries of outrage from the American people due to monthly healthcare premiums increasing way past many Americans’ mortgage payments, and have responded appropriately. Since the GOP is against increasing the subsidies that are given to health insurance companies as something that would further put us in debt, and do not want to leave Americans stranded with ridiculously high health insurance premiums, they have attempted to do what every Democrat hoped they’d never do: decrease overall healthcare coverage. The GOP has attempted to get legislation through that would, in many ways, give health insurance companies a reason not to cover certain health conditions that people had before they had health insurance. Not covering these health conditions, in turn, decreases costs for health insurers across the board, and therefore helps quell rising monthly premiums.

Many liberals have cried about how health insurance companies would be able to afford the rising costs if they did not pay their CEOs such large salaries. This argument is moot. One, a CEO’s measly little salary of 6 million dollars is a drop in the bucket compared to the 3 billion dollars in claims paid out to hospitals and clinics. Two, no amount of persuasion, legislation, protesting, whining, or screaming is going to affect how much companies pay their CEOs. It’s a free market.

If you bought a used car on Monday with a cracked windshield, got auto insurance coverage on the car on Tuesday, and filed a claim to have the windshield replaced on Wednesday, the auto insurance company would immediately decline to cover the cost of that repair. Why? Because the car did not have insurance BEFORE the damage was done to the windshield. Applying this to healthcare, why should an insurance company be forced to cover conditions or accidents that occurred before the individual had health insurance? The whole point of health insurance is to have it in case something happens. This does not mean that people with pre-existing conditions will not be able to get the healthcare; it just means that they will have to figure out some other way to pay for it. I would suggest they start a health savings account.

Americans are not very smart with their money. The average American’s savings account is almost nonexistent. That is why I support the GOP’s efforts to increase the prevalence of health savings accounts in new legislation. A health savings account would be one that’s specific to major healthcare costs that could either be unexpected or expected (such as dealing with a chronic illness). This would provide an acceptable substitute for health insurance companies refusing to cover pre-existing conditions. The costs incurred by an individual’s pre-existing condition would be then paid for out of their health savings accounts, and not their health insurer, decreasing the overall financial burden on health insurance companies.

While healthcare is looked at by most Democrats as a right that should be provided to every American no matter the cost, this is not realistic. Democrats should realize that a socialized health system is inherently incompatible with the core Republican belief in small government. Conservatives across the board do not think that federal government regulations are the solution to every problem. They would rather have free market solutions implemented, such as an increased prevalence of health savings accounts within health care plans. These free market solutions leave the choice of where people’s money is spent up to each individual and not the federal government.

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