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Medical savings accounts: opportunities for cost savings? |
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| Authors: | Gregory S Zaric Jeffrey S Hoch |
| Affiliation: | Ivey School of Business, University of Western Ontario, London, ON, Canada N6A 3K7 E-mail:; Centre for Research on Inner City Health, St. Michael's Hospital, Toronto, ON, Canada M5B 1W8; Department of Health, Policy, Management and Evaluation, University of Toronto, Toronto, ON, Canada M5T 3M6 |
| Abstract: | Interest in medical savings accounts (MSAs) as a potential tool to reduce healthcare costs has been widespread. A small number of countries have either implemented or run pilot programs of MSAs, and vigorous policy debates have taken place in several other countries about the potential merits of introducing MSAs as a method of paying for health care. In this paper we develop a model to assess the cost saving potential of MSAs in a publicly funded healthcare system. We assume that the public healthcare payer may choose between reimbursing healthcare expenditures through an MSA or through a form of third‐party payer insurance. We use the model to identify the conditions under which MSAs may reduce costs. We illustrate using data on healthcare expenditures from Canada. |
| Keywords: | health care medical savings accounts healthcare reform health insurance |