By Jacqueline Ellison, Paul Shafer, and Megan B. Cole
Health Affairs, November 2020
With the rise in the share of privately insured patients covered by high-deductible health plans (HDHPs), understanding sociodemographic trends in the uptake of health savings accounts (HSAs) is increasingly important, as HSAs may help offset the higher up-front costs of care in HDHPs. We used nationally representative data from the National Health Interview Survey from the period 2007–18 to examine trends in HDHP enrollment and HSA participation among privately insured adults by income level and race/ethnicity. Our findings show a substantial increase in HDHP enrollment across all racial/ethnic and income groups from 2007 to 2018. However, Black, Hispanic, and low-income HDHP enrollees were significantly less likely than their White and higher-income counterparts to participate in HSAs, and these gaps increased over time. This means that the HDHP enrollees most likely to benefit from the potential financial protection of HSAs were the least likely to have them. If these trends persist, racial/ethnic and income-based disparities in cost-related barriers to care may widen.
From the Discussion
Increased HDHP enrollment across all income levels and racial/ethnic groups reflects the larger trend in employers’ HDHP plan offerings during the past decade, as employers have often shifted costs to workers and attempted to minimize premium growth by using high deductibles and offering less generous benefits. Although other studies have documented increasing rates of HDHP enrollment in aggregate, our findings show that these increases have occurred across all income and racial/ethnic groups over time. As these trends persist, low-income, Black, and Hispanic populations, who already experience financial and structural barriers to care, may disproportionately experience negative consequences of high cost sharing.
Lower HSA participation among low-income individuals and families may be a result of this population being less likely to have an employer that contributes funds annually to the HSA or because lower-income people have fewer resources to set aside for future health care expenses. Research has demonstrated that lower savings levels among Black and Hispanic workers are primarily a consequence of inequities in intergenerational wealth, education, and employment. Thus, our finding of lower HSA participation among Black and Hispanic HDHP enrollees is likely a result of the disproportionate structural burdens borne by these communities. Fewer opportunities and lower incomes, compounded by labor-market discrimination, contribute to the racial/ethnic wealth gap and subsequent ability to save, as well as to the likelihood of being in a job that contributes to an HSA. Thus, institutionalized racism, as opposed to individual choices or agency, is the likely driver of observed racial/ethnic disparities in HSA participation.
Lower HSA uptake among people earning below 200 percent of the federal poverty level ultimately means that the people most likely to benefit from HSAs are those least likely to have them. Research consistently demonstrates that even minor cost sharing can result in the delay or avoidance of essential care, adverse events, and emergency department visits among low-income and chronically ill patients.
By Don McCanne, M.D.
High-deductible health plans (HDHPs) are promoted as a means to make patients more prudent shoppers of health care by making them responsible for upfront costs. But it has been well documented that these out-of-pocket costs have caused patients to forgo beneficial health care that they should have. To counter this adverse consequence, health savings accounts (HSAs) have been promoted to cover the upfront expenses. The problem here is that too many people do not have HSAs, and, if they do, the accounts frequently remain unfunded.
This study confirms that increases in HDHP enrollment have occurred in all income and racial/ethnic groups, whereas “Black, Hispanic, and low-income HDHP enrollees were significantly less likely than their White and higher-income counterparts to participate in HSAs.”
The consequences are obvious. Since those who have the greatest need for HSAs are less likely to have them, it is more likely that they will be unable to afford essential upfront health care services and then suffer the adverse health and financial consequences as a result.
Thus this study confirms that HDHPs and HSAs are yet one more example of institutional racism since they have a disproportionate negative impact on Black, Hispanic, and low-income individuals.
We could make progress in countering institutional racism by enacting and implementing a well designed, single payer, improved Medicare for All. Maybe we don’t have to call active opponents of Medicare for All racists, but we could let them know that their position does support institutional racism. Hopefully enough of them would be sensitive enough to that issue that they might take a more serious look at Medicare for All.
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