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To the editor: While many believe that the time for medical savings accounts has come, it may well have passed. These plans are typically offered by insurance companies desperate to stay in the group insurance market-even though they have little presence in managed care. Managed care may well have made MSAs obsolete before their time.
One such company offers a $1,500 deductible and 100% coverage of claims thereafter, suggesting that employees put $750 a year into the plan. The insurance premiums are only 5% to 10% less than three different managed care alternatives, which are both health maintenance organization and point of service plans.
Fully managed plans now have-or soon will have-a lock on the marketplace, because their plans work. They reduce premium costs and keep benefit levels high.
We needed indemnity MSAs in 1980; we need managed care MSAs now!
MSAs and managed care are not incompatible. For example, an HMO could operate as it does now, providing 100% coverage after small copayments. It could then indicate that the first $1,500 of benefit payments was the deductible, with perhaps half of this assigned against the MSA fund and the balance charged back to the employee. One impediment might be capitation arrangements, but even that problem can be overcome.
I don't think major managed care companies will embrace the new MSA law until Congress removes both the cap on company size and the cap on overall participation. Such plans require too much upfront computer programming for such a small return.
It is time that two good concepts join forces-MSAs and managed care.
Mark A. Mitchell
U.S. Benefit Consultants