Health savings accounts grow more popular, but critics skeptical

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(05-04) 04:00 PDT American Capital --

More than 6 million people are enrolled in wellness coverage programs that let them to also unfastened wellness nest egg accounts, nearly dual estimations from just two old age ago, according to new industry projections.

But critics of wellness nest egg business relationships were not impressed with the registration figures. They released a separate study last hebdomad from the Government Accountability Office that said taxpayers with wellness nest egg business relationships had an adjusted gross income averaging about $139,000 in 2005, compared with $57,000 for all other filers.

The taxation figs intend the affluent are using the business relationships as a taxation shelter rather than as a agency to assist them afford wellness insurance, said Democratic Reps. Pete Stark of John C. Fremont and Henry Waxman of Los Angeles.

Karenic Ignagni, president and main executive director military officer of the trade grouping America's Health Insurance Plans, said the GAO's Numbers showed that the typical enrollee deposited $2,100 in a wellness nest egg business relationship in 2005 and withdrew $1,000. She said those figs hardly stand for amounts that could be described as a taxation shelter for the wealthy.

Health nest egg business relationships are a relatively new merchandise pushed by the Shrub disposal as a manner to decelerate rising wellness attention costs. Workers who purchase wellness coverage programs with a high deductible tin sedimentation up to $2,900 into the business relationship taxation free, or up to $5,800 for families. Consumers can utilize the money in their business relationship to pay their medical disbursals or salvage it for future needs, including retirement.

Overall, registration in such as programs stands for 3.4 percentage of the private coverage market, said America's Health Insurance Plans, which compiled the up-to-the-minute registration projections. The association said more than than a one-fourth of new enrollees were previously uninsured.

The state with the peak per centum of high-deductible enrollees was Minnesota. About 9.2 percentage of the state's sum registration in private wellness coverage come ups through high-deductible plans. Following closely behind were Louisiana, with 9 percent, and the District of Columbia, at 8.7 percent.

Supporters of wellness nest egg business relationships state the business relationships do wellness coverage low-cost because the insurance policies that attach to them generally necessitate less monthly premiums.

But critics inquiry whether the mediocre and those with high medical disbursals can afford the up-front costs. They're concerned the programs are attracting two extremes: those who purchase the policy because it's cheaper but are not able to put in the nest egg accounts, and those who utilize the business relationships to bring forth taxation breaks.

The GAO said national studies bespeak that more than than 4 out of 10 people who purchased high-deductible plans don't unfastened a wellness nest egg account, even though they were eligible to make so. Participants said they lacked information about the accounts, they could not afford them, or they did not believe they needed them.

Waxman and Stark renewed phone calls for statute law that would necessitate enrollees in wellness nest egg business relationships to turn out that backdowns were for medical expenses.