POLICY: From the country that loves the HSA

The future of American health insurance, South African style — Patients bleed hospitals dry

Hospitals in Limpopo are owed about R146m by patients whose medical aid companies haven’t settled their bills and those who lied about being poor. Limpopo has 43 state hospitals that provide private wards for financially well-off patients who prefer to use their own doctors, instead of state doctors.Provincial health spokesperson Phuthi Seloba said on Tuesday that the department was seeking tenders from debt collection companies to collect the outstanding money, starting in March.

On the other hand, we know it’s a future that’s already here.

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  1. I had a lengthy post on TPM café last week about HSAs, which (thanks very much) I notice you linked to.
    Although my surgical practice is a “pay cash for service” affair for the most part, insurance billing of some sort forms maybe 25% of our income. Collection lag is perhaps two months with the insurance cases, and that’s with everything negotiated before the scalpels come out. Our private patients generally have a three week collection lag on average. So from my experience, the private patients pay faster.
    However, this is elective surgery. It’s totally atypical. About the only use for HSAs in my patient care plan is for the minority of insurance-compatible cases where we can set up a quick “Drop conventional coverage – start HSA – deposit surgical fee – get surgery – pay fees from HSA – resume conventional coverage.” scheme. Given the income level of my typical patient, this allows them to pocket a nice tax break.
    So doctors can do the same sort of thing that Rob Greiner quotes above.

  2. Those monkeys with PHDs at the NCPA say that the tax free MSA was started in South Africa and the MSA Original Pilot Test of tax free accounts did not really happen in America and I don’t really exist. Darn Dr. Devon Monkey of the NCPA. No FICA tax on Employer HSA deposits. Even if the employee saves their own money in an HSA it can be arranged that the employer saves all payroll taxes. This may be an 18% savings for the employer. Princetonian Rwe Rhinehart says, “Oh no, Walmart will save a fortune if they get their employees to maximise their savings. Shoot, if Walmart employees save $100 million in ther HSAs Walmart will saves tens of millions of dollars. It’s bad when employers and employees bind together and cut the IRS out. It’s like stealing from the government.”

  3. To be honest Trapier, this was a real quick shot–and I’m not even certain that medical aid compnies are the same as HSA companies, but I think so.
    But there has been several articles here, on Ezra’s blog and elsewhere about the problems of HSAs in Singapore and South Africa.

  4. I am not seeing the connection to American HSAs.
    It may be convenient to point out 1) a problem with S. African healthcare and 2) that S. Africa uses HSA-type insurance. But can you really then claim there is obviously a problem with HSAs in America?
    This is not disimilar from the assasignation by association going on at TPMCafe’s Drug Bill Debactle: “The defunct Medicare Part D policy came from the 2003 Medicare Modernization Act…HSAs came from the Medicare Modernization Act…therefore, obviously, HSAs are a defunct policy.”
    I’d expect you to be too sophisticated to buy into that style. Hopefully your readers are at least.
    The above link probably does highlight a potetial fault in HSAs. Flesh it out for us.
    Trapier K. Michael

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