A Republican proposal to put cash in personal health accounts for some Affordable Care Act exchange plan users could be great for the companies that administer the accounts.
Democrats on the Senate Finance Committee — who oppose the proposal — said in a report posted by Sen. Ron Wyden, D-Ore., last week that they want more information about how much financial services companies get for administering health savings accounts, flexible spending arrangements and similar types of personal health accounts.
But Senate Finance Democrats suggested in the report that, if the proposed ACA health accounts work like ordinary commercial health accounts, the administrators might get a steady stream of fee revenue.
The Senate Finance Democrats cited HSA revenue sources at UnitedHealth's OptumBank as an example.
OptumBank, which now administers 8 million active HSAs, gets a few dollars in maintenance fees per account per month, a $2.50 fee when a patient takes HSA cash out through an automated teller machine, and a $20 "outbound transfer fee" when the account holders send some or all of the assets to another custodian, according to the report.
"The common theme across these arrangements is massive profits for financial institutions and big insurance companies," the Senate Finance Democrats said.
The authors of the report suggested that, in addition to UnitedHealth's Optum Bank, the list of entities that could benefit from the creation of a new ACA health account program includes Bank of America, Fidelity, HSA Bank and HealthEquity.
The backdrop: The White House was close to releasing an ACA "cash for coverage" proposal earlier this week, according to press reports.
An official text or summary of the proposal is not available, but CNN and Politico have reported that it updates the current ACA subsidy rules.
The original rules, which first applied in 2014, limited access to subsidies to exchange plan users with income under 400% of the federal poverty level, or $62,600 in most of the country for an individual.
The current "enhanced subsidy" rules, which were adopted in response to the COVID-19 pandemic and expire Dec. 31, increased the subsidy levels and made subsidies available to people at any income level if the cost of standard coverage exceeded more than about 10% of their income.
The new version under consideration at the White House appears to make at least some subsidies available to people with income up to 700% of the federal poverty level, or $109,550 for an individual.
If exchange plan enrollees agreed to use plans with lower premiums, the government would reward the enrollees by putting the difference between the cost of the standard-premium plans and the lower-premium plans in the enrollees' health accounts.
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