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Bush Visits Bridgeport, Conn., To Tout Health Savings Accounts

Posted on: Friday, 7 April 2006, 00:00 CDT

By Anusha Shrivastava, Waterbury Republican-American, Conn.

Apr. 6--BRIDGEPORT, Conn. -- Pitching health savings accounts as a way for businesses to remain competitive, President Bush urged people to learn more about them as he addressed a gathering Wednesday in Bridgeport.

"People are plenty smart when it comes to making a decision about health care," but when someone else pays the bills, consumers don't pay attention to the cost, Bush said during the forum on health savings accounts held at the Playhouse on the Green, a theater.

With health savings accounts, he said, a consumer has a stake in the cost of services and medication provided because the money is coming out of a tax-free savings account owned by the consumer, who can roll over the unused amount from one year to the next.

To use a health savings account, employees set aside up to $5,450 a year for family coverage in tax-free accounts, pairing it with a high-deductible insurance for catastrophic coverage.

"We have seen that employees are managing their money correctly and receiving the care they need," said Verna Moran, vice president of human resources at Seitz Corp., a Torrington manufacturer and one of six panelists for the forum.

"We funded the health savings account 100 percent for the employees because we were saving so much on the premiums."

Despite paying the full deductible of $1,250 for individuals and $2,500 for a family, Moran said, the company saved nearly $100,000 on insurance costs last year.

Seitz decided to switch last year to an Open Choice health savings account offered by Hartford-based insurer Aetna because, she said, the company was facing a 28 percent increase in the third-party-payer plan it was using.

Interrupting Moran, Bush said many companies facing such an increase might have opted not to offer insurance at all, which could eventually weaken the small business sector, where 70 percent of job creation occurs.

Apologizing for interrupting, Bush then asked Moran to continue. She said he could interrupt her "any time."

"Maybe here, but not at the house," Bush replied, smiling.

Relaxed and jovial, the president tried to connect with the audience of about 150 businessmen from the Business Council of Fairfield by sharing with them his passion for health savings accounts.

Outside, a group of about 200 protesters waved placards that read "Worst president ever" and denounced his health care proposals and the war in Iraq.

"With this president, there's a lot to protest," said Hamden resident John Shanley, a member of a state group opposed to the war.

Inside the theater, the president was talking to a friendlier group.

"He was wonderful and he really engaged the crowd," said Paul L. Jones, senior vice president for Webster Insurance in Westport and one of the invited guests.

From a business point of view, HSAs have the potential to sustain organizations, said panelist Greg Gravel, president and chief executive of the Whitney Center, a continuing care retirement community in Hamden. Thirty-six percent of the center's staff chose an HSA plan in 2005, saving the center $75,000 in health care spending.

"HSAs are something which can make health care more affordable for businesses," said D. Robert Morris, an attorney with Pullman & Comley LLC in Bridgeport. "They can provide good quality health care for employees."

David E. Snediker, an attorney with Paul, Hastings, Janofsky & Walker LLP in Stamford, isn't so sure.

"This has certainly motivated me to learn more about the accounts," he said after attending the hour-long session. "It is pretty daunting to figure out what's best for the employees, but ... when I had major surgery recently, I took the time to find out who the best person to operate on me would be. So, when you are really concerned about your health, you will pay more attention, because otherwise you are wasting money and probably not getting the best care."

There are more than 400,000 uninsured people in Connecticut, according to a recent business council study.

Health care is also becoming contentious in labor negotiations. In February, union workers went on a six-week-long strike when Sikorsky Aircraft Corp. demanded they contribute more toward health care. Ultimately, the workers gave in.

As the cost of health care rises, some, including union leaders, have talked about a nationalized health care system.

Critics, meanwhile, say health savings accounts work well for the healthy and the wealthy, but lower income and elderly people lose out.

That's not the case, Bush said, because as the system becomes more transparent, costs will go down for everyone. Citing the example of Lasik eye surgery, Bush said it was expensive years ago, but when people began to shop around the cost decreased. "The consumer was shopping," he said.

The crux of the matter, Bush said, is a "philosophical debate" on whether the government ought to be the "decider" versus a system in which individuals are responsible.

"We ought to work to make sure health care is affordable and available," he said. "HSAs address one of the major cost drivers. The more the consumer is involved in pricing, the more likely it is that the consumer will make more rational decisions."

Further, he said, "It is an interesting way of making sure that the patient and the provider are an integral part of the decision. ... Information keeps people involved."

HSA BANK EXEC DISCUSSES HEALTH SAVINGS ACCOUNTS WITH BUSH

Nathaniel C. Brinn called his opportunity to meet President Bush and discuss health savings accounts hectic, exciting, and unique.

He also said it was a lot of fun.

Brinn, chief executive officer of HSA Bank, a subsidiary of Waterbury-based Webster Financial Corp., was among a group of experts who met Tuesday morning with the president, Treasury Secretary John Snow, National Economics Council Director Allan Hubbard, and presidential adviser Karl Rove in the west wing of the White House to discuss the status and future of health savings accounts.

Brinn and E. Craig Keohan, president of First Horizon Msaver, a division of First Horizon Bank, began the day Tuesday by meeting with Hubbard and senior health care economics adviser Roy Ramthun in Hubbard's office at 8 a.m. Brinn and Keohan then met with Bush and others in the west wing, Brinn said.

Brinn then flew back to his home in Avon late Tuesday night and traveled to Bridgeport Wednesday morning to take part in a forum on HSAs in which Bush was the featured guest.

"The Bush administration is solidly committed to HSAs and is convinced the concept is starting to take off," Brinn said Wednesday. "Now the key is getting the public to understand the benefits of these accounts. You might say the administration is now on an education mission."

Tuesday's meeting with Bush lasted for about 80 minutes and included a discussion on how to overcome some of the hurdles that have inhibited the growth of HSAs nationwide, Brinn said. Suggested solutions included allowing rollovers of health reimbursement accounts into health savings accounts; increasing the maximum annual contributions; improving price transparency of medical procedures, and allowing 100 percent contributions no matter when in the calendar year the account is established.

HSAs are a form of health care coverage that combine a high-deductible catastrophic health insurance policy with low premiums and a tax-deferred savings account to pay for routine medical expenses.

HSAs "are an important tool for Americans and small businesses to bring the high costs of health care under control," Brinn said. They also "put you in the driver's seat when it comes to mapping out your health care spending."

Webster entered the HSA market in September 2004, when it announced a deal to acquire Eastern Wisconsin Bancshares Inc. of Howards Grove, Wis., parent of State Bank of Howards Grove. At the time, State Bank, which also operated under the trade name HSA Bank, handled the nation's second-highest volume of HSA activity, with more than 55,000 accounts.

In the 18 months Webster has owned HSA Bank, the company has roughly tripled in size. Today, the subsidiary has about 100 employees and 150,000 HSA accounts, with about $300 million in deposits, Brinn said.

--By Marc Silvestrini

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Source: Waterbury Republican-American

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