Do you think a Medical Savings Account program is too complex or expensive for your company? Kelly Chrisbacher, the office manager at Bethany Women's Healthcare & Birth Center (BWHC) in Phoenix, did. Then, in January, her company's health plan tacked an additional 5% onto its previously announced 25% increase in premiums. Chrisbacher decided it was time for the company and its 14 employees to look around for an alternative. Traditional coverage made no sense, she figured: In 1998, premiums for BWHC's preferred provider organization (PPO) plan came to nearly $48,000, while employees submitted only about $3,500 in claims.

Chrisbacher remembered hearing something about MSAs from doctors in the practice who had attended a seminar at a local hospital. First, she contacted a local agent. He didn't know much, but referred her to MSAver Resources, a general agent in Overland, Kan., that administers MSAs. Next step: MSAver helped her select a Fortis Health plan that allows BWHC employees to remain with the same PPO network they're now in.

BWHC will pay 100% of the premiums, and it plans to put in 30% to 40% of its policy's deductible ($2,000 for individuals and $4,000 for families) in the tax-free accounts. Chrisbacher says the company has reduced its health-care costs by 50%. "I used to think that MSAs were too complicated. I could kick myself for not doing this a year ago," she says.

If you're thinking about using MSAs, keep an eye on the news out of Washington. MSAs were set up for a four-year trial run under the Health Insurance Portability & Accountability Act of 1996. Unless there is further legislation, the program will expire on Dec. 31, 2000.

For now, either the employer or employee -- but not both -- can contribute to the account in a given year, but there is no restriction on cost-sharing premiums for the high-deductible policies that go with MSAs. Annual contributions are limited by law to a maximum of 65% of the deductible for individuals (a minimum of $1,550 and a maximum of $2,300) and 75% of the deductible for families ($3,050 to $4,600). Employer contributions are also tax-free. Distributions not used for medical expenses are subject to a penalty tax of 15%.

If you would like to find out more about MSAs or investigate setting one up, check out the following resources:

The Urban Institute, a Washington think tank, answers 10 basic questions about MSAs.
www.urban.org./news/factsheets/msaFShtml

The National Center for Policy Analysis, a research group based in Dallas, provides background and guidelines.
www.ncpa.org/pi/health/hedex3.html

The Internal Revenue Service:
irs.ustreas.gov/prod/forms_pubs/pubs/p969.htm

If you'd like to contact an MSA administrator, here are some leading vendors that serve companies nationwide:

American Health Value
800 914-3248
www.americanhealthvalue.com
Boise, Idaho

Mellon Bank
888 200-0515
www.mellon.com/personal/msa/
Pittsburgh

Merrill Lynch
800 637-7455 Ext. 3734
www.ipbg.ml.com/prodservs/bs_msa.html

State Bank of Howards Grove
920 565-3351
www.bankwi.com
Howards Grove, Wis.

Wells Fargo
888-493-2672
www.wellsfargo.com/biz/bizmon/medsavings/
Lafayette, Calif.

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