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Health Savings Accounts: 25 Years of Restoring Patients’ Rights

President at Paragon Health Institute
Brian Blase, Ph.D., is the President of Paragon Health Institute. Brian was Special Assistant to the President for Economic Policy at the White House’s National Economic Council (NEC) from 2017-2019, where he coordinated the development and execution of numerous health policies and advised the President, NEC director, and senior officials. After leaving the White House, Brian founded Blase Policy Strategies and serves as its CEO.

John Goodman

Michael Cannon

Paragon President Brian Blase appeared alongside Michael Cannon, and John Goodman during CATO’s live event “Health Savings Accounts: 25 Years of Restoring Patients’ Rights.”

From the live event description:

Ever since Congress created the income tax in 1913, workers have been able to avoid paying tax on income they receive in the form of fringe benefits, such as health insurance. The flip side of this feature is that Congress effectively threatens workers with higher taxes unless they allow their employer to control a large portion of their income and their health insurance. As marginal income‐​tax rates grew, so did that implicit penalty. As health insurance premiums grew, the amount of workers’ money this feature allows employers to control directly has grown to roughly $900 billion per year.

Eighty‐​three years later, on August 22, 1996, President Bill Clinton signed a law creating tax‐​free Archer Medical Savings Accounts (MSAs). Archer MSAs freed workers to receive a small portion of their health benefits as cash—without a tax penalty. Later, President George W. Bush signed a law creating tax‐​free health savings accounts (HSAs), which allow workers to take more of their health benefits as cash without negative tax consequences. Even so, HSAs have reclaimed for workers less than 5 percent of that $900 billion.

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