OVERLAND PARK, Kan., April 4, 2006 (PRIMEZONE) -- E. Craig Keohan, president of First Horizon Msaver (www.FirstHorizonMsaver.com), was called on by the White House today to participate in a Health Savings Account (HSA) panel discussion on ways to make Health Savings Accounts accessible to greater numbers of Americans. In attendance were President George W. Bush, key White House and Cabinet officials, and representatives from major employers, insurance carriers and financial institutions.
Keohan is a pioneer in the field of medical savings accounts. In 1997 he joined Msaver Resources, which was acquired in 2005 by First Horizon National Corp. (NYSE:FHN). He currently serves as the chairman of the American Bankers Association HSA Council. First Horizon Msaver services HSA accounts for many of the nation's health insurance companies, large employers and distributing agents and brokers.
Keohan said that he sees the greatest obstacle currently standing in the way of faster and more widespread adoption of HSAs as the proration of contributions.
"HSAs are making health care more affordable," Keohan said. "But one of the greatest obstacles to expansion of HSAs is the lack of parity between the health plan deductible and the HSA contribution as the calendar year progresses. Because the contribution amount is prorated on a calendar year and the health plan deductible is consistent regardless of when the policy was purchased, the appeal of an HSA diminishes each month. One solution would be to allow a 100 percent contribution to the HSA account regardless of when the health plan was established."
Since being introduced in 2004 as part of the Medicare Modernization Act of 2003, HSAs have been quickly adopted by individuals and employers who want to cut the cost of health care insurance and make more choices about the coverage.
According to the American Health Insurance Providers (AHIP), the number of individuals covered by HSA-type insurance plans has grown to 3.2 million -- a seven-fold increase since November 2004. Furthermore, 31 percent of those purchasing this type of coverage were previously uninsured individuals buying health insurance on their own. Thirty-three percent of the early adopters were small businesses not previously offering health care coverage to their employees.
While the adoption of HSAs has gotten off to a faster start than did IRAs or HMOs, many within the administration and the industry think that changes can be made to make these plans even more attractive to individuals and businesses. The Bush Administration has several proposals before Congress that address issues with the tax code and price transparency and that are intended to make HSA-style plans beneficial to larger numbers of people.
The Treasury Department projects the number of people covered by HSA-type plans to rise to more than 25 million by the year 2010. The President's HSA proposals, if adopted, are projected to increase the number of Americans with HSAs from 30 million to 45 million individuals by 2010, a 50 percent increase.
"Health care costs are rising sharply in this country," Keohan said. "HSAs invoke consumerism back into health care, which ultimately should drive medical costs down."
About First Horizon
The 13,000 employees of First Horizon National Corp. provide financial services to individuals and business customers through hundreds of offices located in more than 40 states. The corporation's three major brands -- FTN Financial, First Horizon and First Tennessee -- provide customers with a broad range of products and services including:
-- Capital markets, one of the nation's top underwriters of U.S.
government agency securities
-- Mortgage banking, one of the nation's top 20 mortgage originators
and top 15 servicers, which earned a top-10 ranking in customer
satisfaction from J.D. Power and Associates
-- Retail/commercial banking, with the largest market share in
Tennessee and one of the highest customer retention rates of
any bank in the country
FHN companies have been recognized as some of the nation's best employers by AARP, Working Mother and Fortune magazines. FHN also was named one of the nation's 100 best corporate citizens by Business Ethics magazine. More information can be found at www.fhnc.com.
NOTE TO EDITORS: The Associated Press today transmitted a photo of President Bush with Craig Keohan and the HSA panel. This photo also is posted on Yahoo at http://news.yahoo.com/photo/060404/480/whgh10404041502