Tax Proposals and Health Savings Accounts (HSAs)
GAO Study Again Confirms Health Savings Accounts Primarily Benefit High-Income Individuals
A new Government Accountability Office report indicates that Health Savings Accounts are used disproportionately by affluent households. Its findings also suggest that HSAs are being used extensively as tax shelters.
Analyses
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Paul Van de Water Testimony: Health Reform’s Health Insurance Tax
May 9, 2013
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Limitation on Use of Tax-Advantaged Health Accounts Should Not Be Repealed
June 5, 2012
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Testimony of Paul N. Van de Water - Senior Fellow, Center on Budget and Policy Priorities - Before the Subcommittee on Oversight Committee on Ways and Means U.S. House of Representatives
April 25, 2012
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Georgia’s Tax Breaks to Increase Use of Health Savings Accounts Did Not Expand Health Coverage
Revised February 10, 2012
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Curbing Flexible Spending Accounts Could Help Pay For Health Care Reform
Revised June 10, 2009
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Background
Some proposals to reform the health care system seek to achieve this goal through changes in the tax code, such as expansion of Health Savings Accounts (HSAs) — individual accounts in which individuals who have a high-deductible health policy can save money to pay out-of-pocket health expenses. Contributions to HSAs are tax deductible and may be placed in stocks, bonds, or other investment vehicles, with the earnings accruing on a tax-free basis. Withdrawals from HSAs also are tax exempt as long as they are used for out-of-pocket medical costs.
HSAs suffer from several serious problems. Most notably, they could actually increase the number of uninsured by weakening the system of employer-based coverage through which the vast majority of Americans receive health insurance.
By the Numbers
