Blogging Employee Benefits

February 2, 2006

GAO Report on Federal Employee HSAs

Filed under: Healthcare — Fuguerre @ 2:05 pm

[Federal Employees Health Benefits Program High-Deductible Health Plan] enrollees were younger and earned higher federal salaries than other FEHBP enrollees.

Hot on the heels of the President’s focus on Health Savings Accounts in Tuesday’s State of the Union Address, the General Accountability Office has published a report on early experience with HSAs under the civil service system, Federal Employees Health Benefits: First-Year Experience with High-Deductible Health Plans and Health Savings Accounts. [GAO-06-271] GAO was asked to evaluate the 14 “consumer-directed health plans” – HDHPs coupled with HSAs – first offered under the FEHBP in January 2005. Concerns had been expressed that such arrangements would attract younger, healthier, or wealthier employees, thereby driving up costs under traditional plans covering older, less healthy employees. Among GAO’s findings –

  • The average age of HDHP enrollees (46) was younger than that of all FEHBP enrollees (59), but similar to that of the other new health care plan (47). GAO pointed to a smaller share of retirees enrolling in the HDHP and the other new plan as the key source of the age differential. Excluding retirees, the difference was more narrow: 44 for the HDHPs versus 47 for all FEHBP plans.
  • HDHP enrollees earned higher salaries (43% earning at least $75,000) than other enrollees (14%).
  • Nonretired HDHP enrollees are predominately male and more likely to select individual versus family plans.

The GAO report also examined decision support tools provided under the HDHPs to assist enrollees in becoming more actively involved in health care purchase decisions.

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