HSAs get a healthy diagnosis

Skyrocketing health-care premiums and a growing wave of uninsured Americans are driving many consumers to open health savings accounts.

Just ask Adam Legas of Provo. Legas, who injured his shoulder in his early 20s, has since been denied health insurance coverage by two major carriers because of his condition. When Legas finally found coverage under a different provider, the monthly premiums topped $500.

So the 34-year-old small-business owner turned to a health savings account for relief.

Legas is not alone. By the end of this year, roughly 200,000 HSAs will be established. By the end of the decade, the number of HSAs is expected to grow to 40 million, a little less than half of the commercially insured population, according to Dr. Stephen Neeleman, a Tucson-based surgeon and co-author of a new book, "The Complete HSA Guidebook."

"In fact, Blue Cross Blue Shield of Louisiana just published data that they alone have 53,000 HSAs," Neeleman said. "That's one little health plan in one of the smaller states of the country."

The Treasury Department has fielded thousands of e-mails and phone calls related to HSAs and the No. 1 page on the Treasury's Web site, in terms of "hits," is the HSA page, according to Molly Millerwise, a Treasury Department spokeswoman.

"We know that many national and regional insurance companies, third-party health plan administrators and financial institutions are offering them," Millerwise said. "The federal government, additionally, will offer these as an option to its employees in 2005."

Health savings accounts are tax-deductible, grow tax-free and are never taxed when used for qualified medical expenses.

HSAs were created in Medicare legislation signed into law by President Bush on Dec. 8, 2003. The accounts are

administered by custodians or trustees, including insurance providers, banks or entities meeting IRS guidelines.

Neeleman has started his own company, HealthEquity, a Tucson-based HSA trustee with offices in Salt Lake City, Provo, Phoenix and Detroit.

To date, his company has opened more than 3,000 accounts. Others offering HSAs in Utah include Regence BlueCross BlueShield of Utah, which has teamed with Wells Fargo.