Health Politics

The less publicized part of the new Medicare drug bill is the ability for people to create the Health Savings Accounts that Cato et al have been drooling over for at least the past decade. They seem so sensible --- letting people use their own money to buy day-to-day health care, and let insurance cover only the parts which are true emergencies. Again, it's not so simple. I have a few questions, and again no answers:

1. The true emergencies are covered by catastrophic health insurance, which pays for everything after $N. These insurance policies should, in theory, be inexpensive and have predictable cost, but what is the rate of premium increase for them? I have heard anecdotal accounts of the rate of premium increase being higher than the general health cost inflation of ~12%, which might make HSAs unaffordable in the future.

2. How many catastrophic health insurance policies are true insurance, and how many have caps, such as lifetime maximums of $1 million? Nearly all insurance policies have such caps, but HSAs are claiming to be "true insurance", back end coverage for really bad disasters, rather than front end after a high deductible.