The Macroeconomics of Health Savings Accounts

Juergen Jung and Chung Tran

No 2010-12, Working Papers from Towson University, Department of Economics

Abstract: We analyze whether the introduction of Health Savings Accounts (HSAs), which is a health insurance reform coupled with a capital tax reform, can reduce health care expenditures in the United States and increase the fraction of the population with health insurance. Unlike previous studies on HSAs, our analysis relies on a general equilibrium framework and therefore fully accounts for feedback effects from general equilibrium price changes. Our results from numerical simulations indicate that the introduction of HSAs increases the percentage of the working age population with health insurance in the long run but fails to control spending on health care. The outcome of a HSAs reform depends critically on the annual contribution limits to HSAs and the interplay of general equilibrium effects. Finally, the long-run tax revenue loss due to the introduction of HSAs is large and can amount to up to 5 percent of GDP.

Keywords: Health saving accounts; health care reform; privatization of health care systems; health insurance; stochastic dynamic general equilibrium model with health. (search for similar items in EconPapers)
JEL-codes: H51 I18 I38 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2010-06, Revised 2016-11
New Economics Papers: this item is included in nep-cmp, nep-dge, nep-hea, nep-ias and nep-mac
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http://webapps.towson.edu/cbe/economics/workingpapers/2010-12.pdf First version, 2010 (application/pdf)

Related works:
Working Paper: The Macroeconomics of Health Savings Accounts (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:tow:wpaper:2010-12

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