Health financing for universal coverage

Medical savings accounts: lessons learned from limited international experience

Discussion paper, Number 3/2002

World Health Organization

Publication details

Number of pages: 57
Publication date: 2002
Languages: English
WHO reference number: EIP/FER/DP.02.3



Medical Savings Accounts (MSAs) have been discussed within health sector reform debates as an appealing health financing alternative. They are frequently labeled as 'an innovation' in the design of health financing instruments (Prescott 1998; Schieber 1997).

Many countries show interest in incorporating MSAs into their national health financing systems and the proposals to adopt MSAs have found support in many places (Buttler 1999; Goodman & Musgrave 1992; Pauly & Goodman 1995;Porter 1999; Ramsay 1998;Sharma 1998; Yu-Tzu 1999). On the other hand, there are criticisms and debates about the possible negative impacts from implementing MSAs (Hurley 2001; Manitoba Centre for Health Policy 2000; Moon, Nichols, & Walls 1997).

MSAs are individual savings accounts that are restricted to spending on health or medical care. The mechanics of MSAs will vary according to their design, including the specific criteria for savings and withdrawals (to be discussed in details in Section IV-D). Similarly, the underlying objectives for implementing MSAs vary. They have generally been introduced for one of three reasons: (1) to encourage savings for the expected high costs of medical care in the future; (2) to enlist health care consumers in controlling costs; and/or (3) to mobilize additional funds for health systems.