What is Medical savings account (MSA)?
‘Medical Savings Account’ or ‘MSA’ is a kind of savings account in the US, which enables the staff who have enrolled in high deductible health plans (HDHP), to save taxes while investing on health as these funds can be used to pay medical bills.
If any funds are left over after all the medical bills have been paid for a particular year, the remaining amount can be encashed. However, these funds are taxable.
The MSA has been replaced by the HSA, which even provides the employee with a credit card for easily paying the medical expenses. Unlike MSA, HSAs can be kept in multiple savings accounts. Hence, it is one of the best savings plans available to an US employee.
