Consumer interest in health savings accounts (HSAs) is high, making HSAs prime for consideration as employers seek ways to better manage health care costs and encourage employees to become smarter users of the health care system.

The largest group insurance program in the world, the Federal Employees Health Benefits Program (FEHBP), will begin offering HSAs in 2005. In late-September, the Office of Personnel Management launched an HSA web site where federal employees could obtain information about the new HSA option. The day after the site launched, it logged more than 12,000 visitors; within 17 days, that number had grown to more than 44,000. More than a quarter of those visiting the site registered to receive email updates and further information on the HSA option.
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In 2003, health care expenditures in the United States hit approximately $1.7 trillion, according to the Centers for Medicare and Medicaid Services. Estimates put the portion of this outlay that is attributable to health care fraud—payment for nonexistent, exaggerated, or ineligible services—at anywhere from 3% to 10%, according to the National Health Care Anti-Fraud Association (NHCAA).

Health care fraud can take many different forms. Perpetrators include providers, patients, and individuals or groups with no connection to the health care system.
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The usual and customary (UCR) price for prescription drugs has risen by more than 20% over the past four years, with the average cost for brand drugs rising about three times faster than that for generics, according to a report issued by the General Accounting Office (GAO).

The GAO tracked monthly price trends from January 2000 through June 2004 for 99 drugs. The 99 drugs were selected from Blue Cross and Blue Shield Association (BCBS) data on the 100 drugs most frequently dispensed for non-Medicare enrollees and 100 drugs most frequently dispensed for Medicare enrollees in certain BCBS programs. The 99 medications included were those for which prices were reported during the entire June 2000-June 2004 period.
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Given the mobility of today’s workforce, many employees who are covered under an employer-sponsored retirement plan leave employment long before retirement, and before they have accumulated any significant retirement benefit. Because of the administrative cost and hassle of maintaining such small accounts, employers have been permitted to cash out small balances, on a mandatory basis. Originally, the maximum amount that could be cashed out was $3,500, but this threshold later was increased to $5,000.
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