House offers bill to increase MSA access

Lawmakers propose making medical savings accounts more attractive as a cost-saving strategy.

By Joel B. Finkelstein, AMNews staff. June 23, 2003.

Washington -- Preliminary attempts to sell small businesses on the benefits of medical savings accounts have largely failed, but lawmakers are trying to revise and expand the concept.

Several Republican lawmakers have introduced legislation to allow more companies to offer employees high-deductible health insurance linked with MSAs. The bill would add flexibility and incentives to the accounts to make them more attractive.

Current law allows either companies or their employees to contribute pretax dollars to these savings accounts, which workers use to cover their medical expenses.

The liberalized MSAs, which the bill's authors have dubbed health savings accounts, "help put individuals in control of their own health care, while helping to manage health care's rising costs," said sponsor Rep. Bill Thomas (R, Calif.), chair of the House Ways and Means Committee.

Proponents of the bill argue that by putting patients in control of their health dollars, those patients will become more frugal consumers of medical services. The accounts also accrue savings for the employees over time, adding an incentive for workers to save rather then spend the money.

"By giving health care consumers -- rather than employers, health plans and government -- more control over their money, this legislation will slow the rising cost of health care, improve the doctor-patient relationship and allow workers to save for their health care needs in the future," said Merrill Matthews, PhD, director of the Council for Affordable Health Insurance, a research and advocacy association representing insurance carriers in small group markets.