Month: May 2022

True-False Questions from the 2024 Health Care Reform Proposal

Test your knowledge on the continuing health insurance reform debate.


The true-false questions presented here are fully explained in the memo A 2024 Health Care Reform Proposal.

Questions:

  1. High-deductible health plans coupled with health savings accounts are more likely to prevent a $25,000 to $50,000 out-of-pocket health expense than short-term health insurance.
  2. The sum of deductibles and worker share of premiums has decreased since the passage of the ACA.
  3. Tax preferences associated with health savings accounts are smaller for low-income people than for high-income people.
  4. The Senate could make major changes to the tax-treatment of employer-based insurance and the premium tax credit based on a majority vote.
  5. Short-Term health plans provide great protection if total health expenditures remain below the annual cap.
  6. The ACA guarantees that people purchasing state-exchange health insurance have access to top cancer hospital if they get cancer.

Answers and Discussion:

  1. True. High-Deductible health plans cap out-of-pocket health expenditures. The current out-of-pocket limits are $7,050 for an individual policy and $14,100 for a family policy. The arbitrary benefit exclusions on short-term health plans can lead to large out-of-pocket expenses for relatively minor health problems.
  2. False. The sum of deductibles and worker shares of premiums has risen since passage of the ACA.
  3. True. HSA contributions are deductible. The value of the deduction is determined by marginal tax rates. This disparity could be eliminated by replacing the HSA tax deduction with a tax credit.
  4. True. if done through the tax reconciliation process. Several tax changes are proposed in the book including the tax credit discussed above and the replacement of the tax subsidy for employer-based health insurance with an employer subsidy of state-exchange insurance.
  5. False: A three-day stay in the hospital could result in thousands of dollars of health expenses for people covered by a short-term health plan. The book points the reader to some papers that found problems associated with short-term health plans could be rectified through reinsurance subsidies or by allowing automatic access to Medicaid for people covered by a policy with an annual cap.
  6. False. In fact, state-exchange health insurance policies tend to have narrower provider networks than employer-based health insurance policies. The book discusses how issues related to narrow network policy might be addressed through network adequacy regulation, expansion of the No-Surprises Act and new subsidies.

I am not looking forward to a 2024 debate between advocates of Medicare for all and people who want to tinker around the edges of the ACA.  The memo A 2024 Health Care Reform Proposal makes the case for a centrist-flavored overhaul of health insurance in the United States.