Health Savings Accounts: A Progressive Alternative?

Jason Furman of the Hamilton Project has put forward an HSA plan that, at first glance, seems pretty sensible:

I propose that households pay 50 percent of their expenses up to 7.5 percent of income, with no cost sharing for low-income households and a $15,000 limit for high-income households.

This will, in his estimation, resolve the “one-size-fits-all” problem that some believe puts an unfair burden on low-income patients. He also believes that this approach will save a good deal of money:

According to my simulations, such an approach could lower premiums by 22 to 34 percent. Even after higher average out-of-pocket expenses, total health spending would fall by 13 to 30 percent.

I am always a little leery of the Brookings crowd, and I’ve had a long day, but I can’t find any obvious problems with this approach.

What am I missing?

[via Health Affairs]

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