As the pandemic lingers, contributing to rising inflation and looming economic recession, Americans from all walks of life may be concerned about their medical bills.
The Healthcare Freedom Act, proposed by Rep. Chip Roy (R-Texas), seeks to help Americans regain control of their healthcare expenses by creating “health freedom accounts” similar to existing health savings accounts. Health savings accounts enable patients to save pretax dollars for future medical expenses, but are limited to only those with high-deductible health plans, and contain numerous restrictions on what types of healthcare spending may qualify. Roy’s bill would allow any American, regardless of their health insurance type, to become eligible for health freedom accounts, as well as expand the list of qualified medical expenses.
As a physician, I call upon Congress to pass this legislation in order to provide patients greater autonomy over their healthcare.
Health savings accounts were first established in 2003 as part of the Medicare Prescription Drug Improvement and Modernization Act and became more prevalent as more employers began offering high-deductible health plans over the past 20 years. Many patients with high deductible plans never meet their annual deductible, and thus are forced to rely on money from their health savings account to cover routine health expenses; for these individuals, any money spent on insurance premiums by themselves or their employer is wasted. To make matters worse, current regulations also prohibit the use of health savings accounts to pay for insurance premiums. These policies serve only to enrich insurance companies at the expense of patients and private employers.
Currently, HSAs allow maximum family contributions of up to $7,300 per year to a tax-deductible account, which enables the contributions to be untaxed for that year. In addition, the money grows tax-free and may be withdrawn from the account untaxed. These tax-protective mechanisms are how HSAs came to be known by the coveted descriptor “triple tax-free.” In addition to allowing all Americans to obtain an HSA/HFA, the Healthcare Freedom Act would nearly double the yearly contribution limit to $12,000, and allow individuals 55 years or older to contribute an additional $5,000. These changes are necessary due to the rapid growth in healthcare costs which routinely outpaces the already-astronomical rate of inflation.
The Healthcare Freedom Act would also expand the list of approved medical expenses to include insurance premiums, direct primary care physician subscriptions, and payment to Healthcare Sharing Ministries. The bill would enable money from HSAs to be spent on all of these, plus additional services that may not be covered by health insurance. For example, patients coming to dermatology clinics may use money from their HSA/HFA to pay for the removal of benign skin lesions or other procedures deemed as “cosmetic” by insurance companies. From the physician side, it allows a wider range of practice possibilities that would enable doctors to practice more personalized medicine.
If HFAs become commonplace, more patients will be able to obtain their medications through compounding and specialty pharmacies, cutting out middlemen and reducing costs. Indeed, physicians will be able to circumvent insurance headaches such as step therapy (requiring patients to fail certain categories of medications before insurance will cover alternative therapies) if patients can pay for their medications directly. As a dermatologist, I frequently use direct-to-consumer pharmacies to help patients obtain customized therapies for their skin.
Healthcare freedom accounts would expand access to these services to patient populations who may not have the financial ability to pay for these treatments out-of-pocket. Employers may also like the added flexibility of HFA’s, as they would be able to offer the new health savings account as an employee benefit without being forced to subscribe to a group high-deductible health plan.
The net effect of expanding the number of approved expenses would be increased patient and physician autonomy. From the patient side, the Healthcare Freedom Act allows them to spend their hard-earned savings in a way that most aligns with their values.
As a physician, I look forward to serving patients based on the ideals of the Hippocratic Oath rather than following arbitrary guidelines created by insurance companies.
Aamir Hussain is a resident physician practicing in Washington, DC. Rufus Sweeney, a medical student at the University of Wisconsin, assisted in the creation of this story.