We envision a future in which all Americans are free to choose their own doctors and therapies, and pay for their own health care, without arbitrary limits.
Today that vision is not a reality. Our health care rights and freedoms are fast diminishing, thanks to the growing problem of health insurance bureaucracy, public and private. Excessive bureaucracy causes prices to soar and innovation to stagnate. Doctors despair. Patients suffer.
The antidote to bureaucracy is freedom—freedom to save and spend your own money for your own health care. Patients and their doctors should not have to bow to profit-seeking insurance companies or wade through senseless government red tape.
Bureaucracy has no place in health care. The doctor-patient relationship is sacred. Health care freedom is a human right.
The best available tool for liberating patients and their doctors is the health savings account (HSA), a unique, tax-advantaged financial vehicle that puts you, the consumer, in charge of your medical choices, rather than some faceless insurance bureaucracy.
An HSA helps your health care dollars go further—15 to 40 percent further, depending on your tax bracket. Today more than 20 million Americans enjoy the benefits of this powerful savings tool.
But HSAs are not perfect. They need to be upgraded—turbocharged—to unleash their full potential. Under current rules, not everyone can have an HSA, and the amount you can save in your HSA is tightly capped.
Remove these unnecessary limitations, and marvelous things will happen. Buying health care will become more of a cash-based transaction. Patients will regain control. Prices will come down. Quality of care will go up. More people will get the health care they need, when they need it.
To make this happen, we need ‘HSAs-for-all,’ a simple but powerful reform that offers an escape route from the dead-end of health insurance bureaucracy, public and private.
HSAs-for-all means unlimited eligibility for HSAs, unlimited after-tax contributions to HSAs, and unfettered spending out of HSAs for legitimate medical expenses.
Turbocharging HSAs is our best hope for saving our endangered health care rights and freedoms.
This is our vision.
In pursuit of it, we pursue five specific policy goals.
- Universal Access. Let anyone have a tax-advantaged health savings account who wants one, including the uninsured. Delink HSAs from insurance.
- Unlimited After-Tax Contributions. Let everyone save as much after-tax money in their HSA as they want (including contributions from friends and loved ones), without arbitrary limits.
- Unlimited Tax-Free Buildup. Let savings build up inside HSAs, tax-free, without limit.
- Unlimited Tax-Free Distributions. Let everyone spend their HSA savings, tax-free, for legitimate medical expenses, without limit.
- True Freedom of Choice. Let people use their HSA savings for alternatives to insurance like health care sharing and direct-pay medicine (direct primary care).
In short, free people to control their own health care destiny.
- We accept the fiscal necessity of limiting pre-tax contributions to HSAs.
- We do not seek government deposits or contributions to HSAs (for example, through refundable tax credits). Such payments invariably come with strings that can unduly restrict recipients’ freedom. Instead, we seek a level playing field without arbitrary limits.
- Practical notes for lawmakers: Goal 1 (universal access) can be achieved by amending the HSA eligibility rules at tax-code section 26 USC 223(b) and (c), and inserting appropriate cross-references in other relevant parts of the United States Code. Goal 2 (unlimited after-tax contributions) can be achieved by amending the HSA contribution limits at 26 USC 223(b). Goal 5 (true freedom of choice) can be achieved by modernizing the statutory definition of tax-deductible ‘expenses paid for medical care’ at 26 USC 213(d).