Traditional plans spread risk. A large number of people pay into a plan in exchange for the assurance that all their medical bills will be covered if they are unlucky enough to fall ill. Some people have greater medical needs than others. By sharing risk and expense, everyone knows that they will get the care they need when they need it. MSAs, in contrast, operate on the notion that individuals should be responsible for their own medical bills.
People save money in a special tax-free account, which they use to cover doctors' bills.
Usually MSAs are accompanied by some sort of catastrophic insurance, a high-deductible insurance policy that pays for medical bills over a set amount. Healthy people would benefit financially under an MSA system because they pay less in medical bills in a given year than they would on premiums for a traditional health care coverage. People who need substantial medical services, however, are worse off, argue consumer critics and economic experts. 8 Sick and poor people would lose out because widespread adoption of MSAs by the healthy would drive up premiums for traditional health insurance plans. 9 Consumers Union predicts that if 25 percent of healthy people enrolled in MSAs, premiums for traditional coverage would increase by 63 percent.