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Health Savings Accounts and High Deductible Health Plans: Are They An Option for Low-Income Families?

Health Savings Accounts (HSAs) are a type of medical savings account that allow consumers to save for medical expenses on a tax-fee basis. They are linked with high deductible health plans (HDHPs), and together these insurance and savings options represent a new approach to health care, commonly referred to as consumer-directed care.

This brief, based on analyses of available data and research, finds that most low-income families would not benefit from HSA-HDHPs due to an already low level of tax liability and the amount of family income that the HDHP and potential cost-sharing would consume. In addition, greater cost-sharing potentially reduces the use of health care among those with low-incomes, particularly those who are not in good health.

Issue Brief (.pdf)