As the pandemic continues and contributes to rising inflation and an impending economic recession, Americans from all walks of life could be worried about their medical bills.
The Healthcare Freedom Act proposed by Rep. Chip Roy (R-Texas) is intended to help Americans regain control of their healthcare costs by setting up “health freedom accounts,” similar to existing health insurance savings accounts. Savings accounts allow patients to save money before tax for future medical expenses, but are limited to people with high deductibles and include numerous restrictions on what types of healthcare expenses are eligible. Roy’s bill would allow every American, regardless of their type of health insurance, to be eligible for health-freedom accounts and expand the list of qualified medical expenses.
As a doctor, I am calling on Congress to pass this legislation to give patients more autonomy over their healthcare.
Health insurance savings accounts were first set up in 2003 under the Medicare Prescription Drug Improvement and Modernization Act and have been used more and more frequently as more employers offer high-deductible health insurance over the last 20 years. Many patients with a high deductible never pay their annual deductible and are therefore forced to use money from their savings account to cover routine healthcare costs. For these people, any money they or their employer spend on insurance premiums is wasted. To make matters worse, current rules also prohibit the use of savings accounts to pay insurance premiums. These policies are only intended to enrich insurance companies at the expense of patients and private employers.
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Currently, HSAs allow maximum family contributions of up to $7,300 per year to a tax-deductible account, so contributions for that year can be untaxed. In addition, the money grows tax-free and can be withdrawn from the account untaxed. As a result of these tax-protecting mechanisms, HSAs became known under the coveted descriptor “triple tax-free.” The Healthcare Freedom Act would not only allow all Americans to receive an HSA/HFA, but would also almost double the annual contribution limit to $12,000 and give people aged 55 and over the option to contribute an additional $5,000. These changes are necessary due to the rapid rise in healthcare costs, which routinely exceed the already astronomical inflation rate.
The Healthcare Freedom Act would also expand the list of approved medical expenses to include insurance premiums, direct subscriptions for primary care doctors, and payments to health care sharing ministries. The bill would make it possible to spend money from HSAs for all of these purposes, plus additional services that might not be covered by health insurance. For example, patients who come to dermatology clinics can use money from their HSA/HFA to pay for the removal of benign skin lesions or other procedures considered “cosmetic” by insurance companies. From the doctor’s perspective, it offers a wider range of practice options that would enable doctors to practice more personalized medicine.
As HFAs become commonplace, more patients can get their drugs from compounding and specialty pharmacies, eliminating middlemen and reducing costs. In fact, doctors will be able to avoid insurance-related issues such as step therapy (which doesn’t require patients to pass certain categories of drugs before insurance covers alternative therapies) if patients can pay for their medications directly. As a dermatologist, I often use pharmacies that contact consumers directly to help patients get tailored therapies for their skin.
Health care freedom accounts would expand access to these services for patient groups who may be unable to pay for these treatments out of pocket. Employers could also like the added flexibility offered by HFAs, as they could offer the new savings account as a benefit to employees without being forced to take out a health insurance plan for high-deductible groups.
The net effect of increasing the number of approved expenses would be greater autonomy for patients and doctors. On the patient side, the Healthcare Freedom Act allows them to spend their hard-earned savings in a way that most closely matches their values.
As a doctor, I’m looking forward to caring for patients based on the ideals of the Hippocratic Oath, rather than following arbitrary guidelines from insurance companies.
Aamir Hussain is a registered physician practicing in Washington, DC. Rufus Sweeney, a medical student at the University of Wisconsin, helped create this story.