Health Savings Accounts

Two weeks ago Winthrop Quigley (subscription) gave us a pessimistic report on the status of Health Savings Accounts in New Mexico. An excerpt:
“Tax-advantaged savings accounts designed to restrain health-care spending have been slow to take off and haven’t made much of a dent in the number of uninsured workers, according to insurance industry research.”
But a report today from Michael Barone is much more promising. Health care costs may actually be slowing their rate of growth. According to Barone “…the evidence is that health care costs are being held down, by the workings of the marketplace, partly in response to health care legislation passed in the last four years.”
New Mexico is not likely to benefit, however. Our tax treatment discourages these accounts. And our vast array of Medicaid recipients do not need the accounts, since someone else pays for their health care.

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