Is a Medical Saving Account the Same Thing as a Health Saving Account?

Medical Savings Account or MSA was the term first used to describe long term annuity plans, similar to IRA's, but specifically designed to put away tax deferred funds to use for medical expenses. MSA's also had been referred to as "Super IRA's" when they were first introduced.

HSA's or HEALTH SAVINGS ACCOUNTS represent an expansion of the MSA concept, and are technically a specific kind of MSA's. However, HSA is now the generally accepted term for a tax deferred account used for the purpose of paying out of pocket medical expenses, when coupled with a HIGH DEDUCTIBLE INSURANCE PLAN.

MSA's were generally available only through employee sponsored health insurance plans, whereas an HSA can be opened up by any qualifying individual, even if they are self employed. Other technical differences between the specific HSA and the more general MSA; Health Savings Account contributions can be made by both an employer and employee in a given calendar year, and HSA's are always portable, where other types of MSA's may not be.

But the differences are subtle and really not that important. What is important is whether you call the account an MSA or an HSA; such accounts can be a great way to manage your healthcare costs, and to gain access to AFFORDABLE MEDICAL INSURANCE.

Health or Medical Saving accounts are generally not recommended for older folks or those with known health problems. But for the young and relatively healthy a Medical Saving Account coupled with a so called consumer driven High Deductible Health Insurance Plan can be an effective method to handle and even lower healthcare costs.

The American Medical Association is a strong supporter of HSA's and MSA's, and has recently published several articles advocating them and offers such programs and health plans on its own health insurance website. Current plans for healthcare reform by legislatures and presidential hopefuls from both parties almost all include the adoption of Health Savings Accounts and High Deductible Plans. The insurance industry is also a major advocate of Medical Savings Accounts and the recent plan put forth by the largest industry organization America's Health Insurance Plans (AHIP) included HSA's as its cornerstone.

Businesses large and small across the nation are beginning to see MSA's as a clear path toward more AFFORDABLE HEALTH COVERAGE for their employees.