Congress Can Help Uninsured...
Health care reform is making its way into yet another Presidential campaign, but another two-year debate over competing plans to help uninsured Americans will do nothing to help those who need insurance right now. Without immediate reforms, the growing problem of the uninsured will only get worse.
Rep. Dick Gephardt threw down the political gauntlet when he unveiled his audacious health care proposal. Naturally, his plan was stridently attacked by opponents for the Democratic Presidential nomination. Yet, they’ve all picked up on Gephardt’s “universal coverage” theme. As the Iowa caucuses (the first real test of strength for any Presidential candidate) draw nearer, the window will begin to close on opportunities for the current Congress to act on meaningful reforms that make health insurance more affordable. Unfortunately, political inertia will take hold as Democrats in Congress unify around a “universal coverage” message. They will do so out of party loyalty to the prospective nominee, and so not to deny their candidate — and the party — a resonant issue for the 2004 election.
Supported by both Democrats and Republicans, Archer Medical Savings Accounts are truly helping the uninsured. Statistics released by the Internal Revenue Service this past fall demonstrate their success.
The IRS revealed that 73 percent of all people who purchased an Archer MSA in 2001 were previously uninsured. That percentage has never been lower than 32 percent since MSAs were first made available to a limited number of Americans in January 1997. In fact, the percentage of previously uninsured people using MSAs has increased every year since their debut.
With an Archer MSA, money is placed into a health account tax-free, grows tax-free, and can be withdrawn tax-free as long as it is used for medical purposes. Any money left in the account at the end of the year can be rolled over to the next year. For employees whose employer provides them with an MSA, leftover funds are the policyholder’s to keep, and more money is added in the new year.
Archer MSA policyholders have already saved more than $100 million in their accounts. This is money that would normally have gone to an insurance company, or been wasted somewhere in the administrative chain. Instead, these consumers will have money for future health care expenses or much-needed long-term care which they can be draw tax free from their MSA.
Archer MSAs have also been helpful in controlling health care costs. Many small businesses, nonprofit organizations and even local governments have turned to Archer MSAs as a cost control measure.
But Archer MSAs have restrictions that inhibit their growth in the marketplace. The program is only temporary, set to expire in December of 2004. There is an artificial cap placed on the number of MSAs that can be sold, as well as restrictions on who can purchase one. About 70 percent of the working population cannot buy an Archer MSA policy due to rules Congress imposed upon the product as part of the pilot program.
Such restrictions make no sense, particularly when more people need affordable coverage and Archer MSAs have proven to be an affordable solution.
The opportunity to make all Americans eligible for an Archer MSA is slipping away. Republicans and Democrats in Congress should help the uninsured right now and forget about Presidential politics until next year.
Karen Kerrigan is chairman of the Small Business Survival Committee, which represents more than 70,000 small businesses nationwide.
