You todays forum is called unbundling the benefit for broader role for Health Savings accounts. More on that in a moment. In light of the senate efforts, what i was thinking of as an ultra competition that used to be held for Young Athletes between ages six to 15 to show their skills in the nfl. It was called the punt, pass and kick competition. It appears that thats actually being discontinued. The announcement came in may after more than 55, 56 years of it. It looks like the senate is up to the task in terms of punting, passing, and the more throw it aside sense, or the kicking approach. We will see how much that competition renews when the senate comes back for the next week and perhaps for the balance of the month as well. I have to be careful because the nfl is rather aggressive on its trade name protection, so it is a news shot as opposed to violating nfl ordinances on punt, pass and kick. Besides theyre leaving it behind because they want to give everyone a certificate for being on the field i guess. Kind of like soccer more than elongated skills. We are starting today a different series of Health Policy events. Everybody has been caught up in the politics of whats been going on. I thought i would try something different, which is flesh out some things that people are doing in Real Research as opposed to moving, you know, the dollars around from one place to another, and some Interesting Articles have appeared in some of the policy journals. What we want to do is talk about giving no matter what youre spending, we could do a better job in the health care and the health we deliver by perhaps taking apart what is conventionally considered the current benefits, and then maybe reassembling it in somewhat more creative ways, which Pay Attention to the people receiving those benefits and might have some voice in saying what works for them. So todays version of unbundling the benefit talks about how Health Savings accounts could be used. Were going to have other events later on this fall which talk about how to perhaps reengineer and restructure primary care, which would combine using a different mix of services but also in some cases for certain times of patients or individuals with highcost, highrisk conditions giving a bit more of intensive care type approach when it is necessary to head off things that might come on further. Thats probably coming up on september 5th. We will also take a look at how to move around the dollars that are nominally included in the medicaid benefits and perhaps retarget and reprioritize them in a different way to ideally get better results, and also maybe look at the distinction between what is said to be equal benefits, everything the same for everybody, as opposed to what might be more equitable benefits where people get what they need in different amounts and different situations. In order to think about what it produces. Today were looking at new ways to deal with Health Savings accounts. Now, at the end of the day Health Savings accounts have a long history and we will hear from our speakers on that, are essentially tax advantaged health benefits. Now, you can move that around. There are other ways we can do it. In fact, some people talk about using hsa ps in so many ways you could almost say it is like a Swiss Army Knife it it doesnt do just this, it does five or six other things. Of course, if you dont have money in you Health Savings account it is a good hypothetical tool but it might be dull in where it can cut. Give credit on the property, victorina is the only manufacture, or perhaps macguyver with chewing gum could perhaps take care of our system. The idea is to move around the tax managed dollars to produce more bang for the buck, integrated in some form or another with Health Insurance. There are some current proposals as to how to change the contours of hsas, but there are more creative and thoughtful ways to reach beyond even tweaking here and there on the margins. We have three speakers today, and our first will talk about how to have a more Precision Approach to hsas. It is an early way to think about this. I will introduce the three speakers separately. Warren roth has just begun a new appointment Teaching Health law and legal writing at st. Johns university, school of law, once known as the red man because that became unfashionable, and then the red storm, adjusted on the campuses. Warren served as associate director of the program and acting assistant professor at nyu school of law, earned a ph. D. From colombia university, also a law. From harvard, has clerk, done Real Research and writing work at seton hall. And he has a hometown connection i suppose because she graduated from George Washington university. I ran across a fashicinating article by warren thinking about a different way to think about health. Had some of those thoughts in the past, but usually they calm me down. It is a combination of how we can produce Better Health with a broader array of tools including investments in some of the social services and ways to determine social determinings of health to get the results we want as opposed to paying people along the way with health care bills. Laurens article will be appearing in the cornell journal of law and public policy, date to be determined as they say. Lauren will talk about a different way to look at hsas and a number of ways to get there. Lauren. Thank you. Thank you for having me here because i will say that typically im talking only to academics. It is nice to have broader audience to talk about hsas. I wrote this article immediately following the election, thinking what are some areas where theres potential bipartisan support, and hsas seemed to me to be an obvious one. I think the conversation is more urgently needed right now given what is going on. So i will give a little bit of Background Information on the hsas, hopefully not stepping on the toes of the other presentation. I expanded the amount of Background Information i was going to give because last night i was at dinner with a friend from college, and he said to me, you know, i think i might have a Health Savings account. And after, you know, one question from me it turned out he did not, in fact, have a Health Savings account, he had a flexible savings account, right . So i think for, you know, this person is one of the smartest people i know, he is a lawyer in d. C. I think if people like him dont really understand how the hsa is, then my guess is a lot of other people have no idea and dont really understand how to use them if they do have them. So theres been a lot of talk about hsas and, you know, in the media, you know, following the politicians, of. Health savings accounts or hsas are part of the movement for consumerdirect health planl, cdhps. Theres a lot of acronyms involved in the movement, hsa, msa, hra. Maybe thats why people cant distinguish, have trouble gushing between them because they get lost a little bit in the alphabet soup. So it is all part of the general shift that got started with pensions from a defined benefit paradigm for Employee Benefits to a defined contribution paradigm. What do i mean by that . With a defined benefit paradigm your employer basically promises you a benefit now or in the future. You will get 2,000 a month for retirement income. I will pay for, you know, all of your Health Care Expenses minus maybe some copayments. To a shift where the employer will place some amount of money, if youre lucky, into an account and you will have the control and the freedom to figure out what to do with that, what are your benefit priorities. Now, of course, the problem as we talked about is if theres not enough money in that account, which i will return to again throughout my presentation, then it is not all that much help to you, right . If you dont have the money to purchase benefits and to provide for your needs, then those accounts which have a lot of potential are not that useful. So theres a big divide, a political divide about these individual accounts. So republicans including president bush who enact the legislation for hsas tend to really love the individual accounts. It goes along with the american ethos of individuality and control and ownership, the idea that people can decide for themselves what their needs are and act on those needs, that you dont have to an employer telling you what to do and providing for your benefits in a way they think is appropriate. Democrats on the other hand tend to think that individual accounts shift the risks to people who are least able to bear it. So democrats are focused on the fact that theres not enough money in the account. Maybe the accounts in theory would be a good idea if they were fully fund, but theyre not. Democrats see it as a way of cutting back on benefits. So talking a little bit about the basics of hsas. So the way it works is that hsas must be combined with a High Deductible Health plan or an hdhp, not to add to our alphabet soup. Instead of traditional private, you know, Health Insurance that covers all of your medical care needs with an exception for some copayments, maybe some coinsurance, but covers your medical needs starting from day one with an hdhp your traditional Health Insurance coverage doesnt start until you reach a pretty high threshold, right . Before that time either youre responsible for paying out of pocket or you can use your hsa if it has money in it to cover those costs. I remember when i graduated from law school in 2004 i spent my whole first year working with employers to put in place these hsas and these hdhps, and at the time people, you know, were up in arms, you know, about the hsas and thinking, you know, this wont be good enough, people wont have enough of their expenses covered. Today people are lucky if they have the hsas, right, because whether they want to or not most people have been shifted towards higher deductible Health Insurance plans and frequently they just they would love to have an hsa that has some money in it. So ill talk about so the High Deductible Health plans dont kick in until the threshold except for an exception for the preventive care. The aca requires they cover some preventive care, but beyond that theres this hole between before your insurance kicks in where you have to pay for the expenses. On the next slide i will talk about the numbers. But professor yi is going to talk a little bit about the Tax Advantages of hsas. She mentioned in her article it is an incredible savings vehicle, triple tax savings, right . So your contributions to the hsa are deductible from income. The Earnings Growth tax free, and withdrawals from the account are not taxed if theyre used for qualified medical expenses. Thats really the focus of the article i have written, is what account what are account holders allowed to spend their money on and how i think it should be different. So money can only be used for medical care as defined under section 213b of the Internal Revenue code. This is a definition that originally applied to a deduction in the tax code for people who have excessively high Health Care Expenses. Right now the threshold the 10 of income, which is an extraordinarily high amount before the deduction kicks in. But when the withhold cdhp Consumer Driven HealthPlan Movement kicks in, its definition was expanded to apply to the whole alphabet soup. All are using that definition which is out of date, and we will talk about how Health Care Scholars are focused on other things beyond traditional medical care. What you see now are these are the 2017 numbers for hsas and hdhps, which have to sfr an annual deductible of 1300 for single coverage and 2600 for family coverage. It is a pretty high maximum for out of pocket copays, 13,000 for a family is for most people, you know, they would start rationing health care far before they got to that point. Employers and employees can contribute up to the maximum aggregate limit which is you know, the congressional proposals work on expanding the limit but right now 3400 for single coverage, 6750 for family and a contribution for people 55 and over. So right now roughly 19 of employees are enrolled in an hsa qualified hdhp, thats careful language. It doesnt mean they opened up an hsa, it doesnt mean theres money in the hsa if they have opened it up. So it makes it you know, you can see from the numbers below that, 25 receive no employer contributions at all. The average employee employer contribution of 1200 for family needs to be balanced against the current average annual deductible for a family of over 4,300. Theres about a 3,000 gap between what the average employer is contributing to the hsa and the you know, the deductible where the insurance really kicks in. There are, as people have discussed and continue discussing, there are a lot of draw backs to hsas. Obviously i dont think theyre insurmountable or i wouldnt have written the paper i wrote, but, you know, the biggest draw backs which weve mentioned before is that you need to have money to fund them. Sarah rosenbaum, a professor at Health Policy said it is a nonstarter for people with low incomes. I think it doesnt need to be true. It is just another vehicle for getting money allocated for health care to people, right . Thats really all these accounts are. So it has Great Potential in my view. The great risk shift which i talked about before, jacob hacker at yale has done a lot of research on this, you know, employees now are paying you know, if they get switched from a traditional Health Insurance plan to an hdhp, theyre paying more of their medical expenses than they used to, right . Professor this is where professor yis work will come in. Not everyone is being switched. Some people are gaining new coverage, but obviously employees are bearing more of the cost than they did before. The idea is that it may not be such a bad thing, right . Health care expenditures are pretty tremendous. We want to find ways to limit them. We want people to think more carefully, are they using unnecessary services, you know, are there ways that this could force people to think more carefully about their medical needs. But the problem with that is that, you know, studies have shown that consumers are not fully rational when it comes to Health Expenditures and there are a lot of reasons for this. First of all, unlike other goods that you might do some shopping around it is pretty hard to shop around and look for competitive prices when youre sick. Obviously if youre in the hospital and you need emergency services, this is difficult. But even if you are just not feeling well the idea of calling five pharmacies to find the best price on a medication is pretty unappealing to most people. You can imagine that this would add burdens to the system that are not currently there. If the pharmacies, everyone had to be there answering individual questions all day long about the prices of services. The other problem is services may not be comparable. How do you value cancer treatments at sloankettering versus the same treatment at a local hospital . How do you deal with the fact that people have a very subjective attachment to their doctors, right . And they may be willing to pay more than they rationally should to see a particular doctor. You know, other reasons, hard to know if the services are even necessary. So forgetting that it may be hard to compare prices, people are relying on their doctors and on experts who know more about medical care than they do to understand if they even need these treatments. So it is a little bit hard for individuals without a medical degree to second guess the doctors and help to ration their own health care. And the final point i wanted to make is that studies are showing and i list a couple here that people are rationing their own health care and avoiding needed medical treatment because they dont have enough money in their accounts. You know, the idea is that you want people to feel the cost, right, with traditional Health Insurance people have no skin in the game so they have no incentive at all to limit their services that they consume. But, you know, here maybe theres a little too much skin in the game, right . And maybe people are choosing to spend the money on other things such as where my research comes in, and in terms of it being complicate i complicated, it comes back to my friend if youre not sure you have an hsa, and then making sure you have enough money to meet your needs and getting reimbursed, it is all pretty difficult. Current legislative proposal and i wont say too much here because it is in such a state of flux, but beyond the most recent proposal i heard from senator cruz, the ahca and the senate bill, the last version i knew about were really focused on doubling the contribution limits to hsas to 5,000 for single coverage and 10,000 for family coverage. Again, this is a nice idea but, you know, if a lot of people dont have money in the account, upping the contribution limit which people are not reaching anyway doesnt really help that much. Focus on giving people more flexibility, you know. Some of the things i mention there, i think the most important one is really reducing the tax penalty when money is not used for qualified medical care. The reason for that is you may have some people avoiding putting money into these savings accounts because it is unpredictable, right . You may hear figures like in retirement you need 200,000 for your medical care, but you dont know that. If people are going to have a really large penalty if they pull the money out and use it for something else, they may be reluctant to use these vehicles. Okay. So now to my proposal which ill spend the rest of my presentation talking about, my proposal is for something im calling precision hsas. These are hsaest ths that are f by employees, employers and also the government. They can be used for a broader array of goods and services depending on the account holders Family Income level. I list you know, i will go back in detail in a minute, but i list the steps and you will notice that step one is to fund the accounts because it is hard to experiment and use the money for interesting things if only the wealthiest americans can afford to fund their accounts. Step two is to allow physicians or other Health Workers because there are huge cost to the system for prescribing, better housing lets say, to prescribe a broader array of goods and services. This is where the catch phrase social determinance of health comes in. I will explain it in a minute. I dont believe it requires amending the definition of medical care under the tax code. I think it is more about having agencies and courts reentinterp this phrase, the change of research the social determi determination is on health out comes. The current definition of medical care is that youre allowed to you are allowed to get a Tax Deduction or to use your hsa money for expenses that are nor the diagnosis, cure, mitigation, treatment or prevention of disease, or for the purpose of affecting any structure or function of the body. So it is a pretty broad definition. The definition is the same for everyone and it is focused on traditional medical treatments instead of other things that might improve health. Here were thinking about housing and education, things that are being linkedin resea i research to have better out comes in the population. The u. S. Spends an enormous amount of money on health care, and i say health care though it is mostly spent on medical care. We spend 17 of the gdp on health care, and yet we have much worse Health Outcomes than comparable countries spending less. I think the time has come to spend on Different Things. I will just give a few examples of what the current definition does. So the current definition of medical care includes what you might expect, doctors visits, hospital services, lab services, cost of medication, transportation to and from medical treatment and, you know, the cost of some improvements in your home that are made for medical reasons, but it is fairly limited. It excludes things that are, quote and this is in the regulations, not the statute merely beneficial to the health of an individual, such as a vacation. I have a few slides that give some examples. This is how finely were parsing it. So whats an example of something thats okay to use your hsa funds for . An air conditioner which is detachable from the property and purchased only for the use of a sick person. Whats not okay, purchasing apparently an air conditioner that prevents everyone in the house from overheating during a heat wave including members in their 90s, lets say. This is again from the regulations. A doctor suggested that a taxpayer install an elevator in his residence so that the taxpayers wife afflicted with Heart Disease will not be required to climb stairs. Also the cost of installing swimming pools is frequently deductible where you can use your individual account for it. What is not okay, paying for Pest Control Services to prevent roaches from making the asthma of children worse. And this is another extreme one from a case. Taxpayers were allowed to deduct the cost of enrolling their son in a school, a College Prep School as a result of drug and behavioral problems, and the cost they were allowed to deduct included tuition, room and bear, air fair and rental cars to and from the school for therapy and an allowance account for the child. But what is not okay, well, you cant use those funds for ordinary education expenses for the poor that are strongly correlated with improving incomes and also improved future health. One of the things that got me started thinking about changing the definition and personalizing the definition of medical care are recent changes to medical care itself. The movement for precision medicine, which is also called personalized medicine, is focused on using an individuals genetic code to predict futileness and tailor treatments for current illnesses. There are not many presentations i give where Angelina Jolies name appears among the slides but it is one. To so people improve the internet search up there. There you go. Now everyone will find our talk, be more interested. People testing positive for certain genes, in this case increased risk of breast and ovarian surgery, are having surgery. Cancer drugs are targeted to particular genetic mutations using immunotherapy. These are some ways in which medical care is becoming more personalized. It made me think if were personalizing medical care, why hasnt the interpretation of the term medical care under the tax code changed at all . Why should the definition be the same for everyone . What if people need different treatments to prevent disease . What if Different Things are affecting their bodies under the definition because they live in different environments . So what think we should be spending more on or focusing more on are the social determine anlts of health. Score buress, health law professor defines as context of where people live, learn, work and play. The basic idea is those with higher levels of income live longer. Now, the causal relationship for this is not entirely understood yet, but then again a lot of medical treatments that we pay for and believe in in this country also have no scientific studies that prove theyre effective. So why are we not spending money on things that clearly seem to be showing improvement in Population Health . As a little extra incentive i put in there i dont know if i have that yes. In a more Unequal Society apparently the rich dont live as long as they do in a more equal society. It is interesting. It is not just affecting the people who cant afford these services, theres something thats affecting Population Health overall. Okay. Just to make sure i stick to my time. But my proposed definition is that we spend more on health care, which i design as any attempts to improve the health of a person including increasing longevity and quality of life, and i think of medical care as something that takes place more often in a hospital or a physicians office, even though thats changing a little bit now days. But health care frequently starts at home with a change in lifestyle. Small changes can have a big impact. Examples we are thinking of here include a babysitter to help you recover more quickly from surgery. If you cant otherwise afford one. After School Programs for your children so they can get exercise and not become obese, not have diabetes. Fresh fruit, vegetables. So the idea for me is that if there are things that are as important or more important than medical care, then we should be paying for those things or allowing people to do so. So funding the accounts directly or through grants to the states, where the states are funding the accounts, you know, more and more of the middle class and the working poor have access to hsas and hdhps, but it is very important that government tax expenditure is focused on improving health care not cater only to the milling class and upper class, the people who can already afford to put money in these accounts, such as the middle class and upper class. To me it could be about sort of changing the default rules, right . People in different income brackets can spend on Different Things, right . So maybe people in the higher levels of income would pay for these things regardless, but a lot of people cant afford to. It is also a way for the government to incentivize certain types of spending that will improve Population Health. I think i will stop there. All right. Thank you very much, lauren. You can think of this as outsourcing the welfare state to the people who are supposed to benefit from it, where they make the decisions rather than get whatever is on the cart in some limited categories. Now, were going to park that for a moment in terms of a different way to think about how to expend or restructure Tax Advantages for health care and Better Health. Were now going to look at the possible coverage effects in some surprising results that our next speaker found with regard to the combination of these hsas and the higher deductible policies related to as to what that effect might have in terms of some portions of the population, as to whether or not it makes coverage more accessible to them and some subsets on that. Our speaker is jinki yi, an assistant professor at quoson university. I was told to say it fast so i couldnt tell if i announced it properly. She received her ph. D. From syracuse in 2006. I came across an excellent article of hers in the journal of Health Economics in january 2015 on this subject. Her primary is public economics with a particular focus on examining the effect of health care and tax reform on Insurance Coverage and working behaviors. In addition to this article, the affected Health Accounts on Group Coverage she has another paper, the spillover on public Insurance Coverage, evidence from veterans. Xiping. Good afternoon, everybody. First of all i would like to thank ai for inviting me here to discuss my Previous Research. I think i feel great to present my Research Work on the Health Savings account today. I believe that because we have a lot of expert about these policies today, so i think our discussion will definitely help me to improve my field of future research. And my presentation will be the fact oh, okay. So my presentation today will be the effects of Health Savings accounts on group Insurance Coverage. I would like to thank my ph. D. Adviser who also is here, his Previous Research about the savings account inspired me to look at this specific policy when i was a third year student, no idea how to start, so he helped me to have a hint to looking at this interesting policy. I find this Health Savings account very interesting because it is a combination of Health Care Reform and tax reform. So i would like to spend time to research to do some research on this specific policy and to try to find some empirical evidence of whatever outcomes i would like to look. So thanks to lauren