Bush Proposes Expanding Medical Savings Accounts

President Bush proposed increasing incentives to boost MSAs but his talk did not address the real problem of availability of qualifying health insurance. Tony Novak of MedSave.com, a national MSA enroller says that only 1 in 3 applicants are eligible for an atractively priced MSA.

President Bush proposed $14 billion in spending and tax incentives to promote the expansion of Medical Savings Accounts (MSA) in a speech this week at the Medical College of Wisconsin. Mr. Bush convincingly argued that MSA accounts promote cost-conscious decisions by patients and allow greater freedom to build long-term relationships with their doctors. But his speech did not include any specifics on addressing he problem of availability of MSA plans throughout the country.

MSA accounts are used to pay routine health costs like doctors visits, prescriptions and preventative care. But they must be combined with a specific type of high deductible health insurance that is not available in all states or to all individuals. According to Tony Novak of MedSave.com, an online enrollment service, only about one in three people who ask about starting a MSA will find a suitable plan. Currently only self-employed individuals and small businesses with young healthy employees have found MSAs attractive", says Novak. In some states like California, state insurance regulations make MSAs so expensive that customers think we made a mistake printing the enrollment forms. Most observers argue that the future success of MSA strategy depends on our ability to make the high deductible insurance available to a larger audience.