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Consumer-directed health plans get mixed reviews
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Health savings accounts are tax-advantaged vehicles in which workers enrolled in high-deductible plans can save money that can be utilized for health-care expenses.

But here's a stunning fact: Only about 50 percent to 60 percent of workers in CDHPs actually contribute to a health savings account. This means that if they do seek health care, they must pay for it with after-tax dollars (after tapping whatever the employer might have contributed to the account).

Below is a rundown of how HSAs work with CDHP plans:

Plan features and rules for HSAs:

Those people who opted to enroll in a CDHP had higher incomes on balance than those who didn't, according to the GAO report. That makes sense. Folks with large disposable incomes can better afford to spend more on out-of-pocket health-care costs than folks who live paycheck to paycheck.

And of course, there's always the fine print to consider when you join a health-care plan for which you must assume an awful lot of responsibility.

"Participants of one focus group reported that they did not always know whether services were provided by an in- or out-of-network provider, particularly in emergency situations. For example, one participant had to pay $1,800 for transporting his wife 10 miles in an ambulance because the ambulance that was dispatched was not an in-network provider."

This expensive ride may not have even counted toward the out-of-pocket limit.

Chances are good that your employer will be offering a CDHP as part of its menu of insurance options. For some employees, it will become the only option. It may be just a matter of time before we're all stuck with them. But while you still have a choice, do consider their pros and cons before signing up for a health-care plan.

Longtime financial journalist Barbara Mlotek Whelehan earned a certificate of specialization in financial planning. If you have a comment or suggestion about this column, write to Boomer Bucks.'s corrections policy -- Posted: Sept. 13, 2006
More stories by Barbara Whelehan
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