Tuesday, March 01, 2016

Proposed Healthcare Changes

I used to think that Donald Trump's suggestion regarding removing the "lines between the states" regarding buying healthcare was a good idea. After reading this Weekly Standard piece - not so much anymore.

Having said the above - here are three changes I would make to the healthcare system in the US:

1. Make dropping a subscriber due to a pre-existing condition illegal. I know that this is part of Obamacare but since I want to scrap Obamacare - this is one part I'd like to salvage.

2. Increase the maximum contribution to FSA (Flexible Spending Accounts) from $2500 to $5000. Also change the "use it or lose it" aspect of FSA's so that any unused monies can be deposited into either a 401K or IRA account prior to April 15th the following year. With more pre-tax money at stake and money that doesn't have to be used by December 31st - people would become more circumspect on how their healthcare money is spent. That should help make the healthcare system more cost effective. And the money not spent being, in effect, pumped back into the stock market would be good overall for the US economy.

3. Change the healthcare plan being "owned" by the employer to being "owned" by the employee. The employer would offer a healthcare plan but also offer the cash equivalent of that plan to the employee in case the employee had a plan from a previous job or just a plan they wanted to be part of (maybe via a fraternal organization or the like). A Catholic hospital could offer a plan that did not include coverage of birth control or abortions but non-Catholic employees would be free to use the cash equivalent to purchase plans that do. Problem solved by a common sense approach.

EDIT: I was a dope and confusing HSA's with FSA's. Fixed.


  1. Dammit.. what did we tell you about common sense?

  2. #2 isn't really needed - HSAs aren't use-it-or-lose-it. You might be thinking FSAs. HSAs are truly a (Health) Savings Account versus a Flexible Spending Account. Even after you stop being eligible for HSA contributions, you can continue to make qualified distributions until your HSA is empty. For example, you could build up your HSA balance over many years while working, then when you qualify for Medicare and become ineligible for HSA contributions use your balance to continue to pay for qualified expenses.

  3. Matt - you are exactly correct. I was confusing FSA's with HSA's.