Medical Savings and Loan

The Medical Savings & Loan is a free market approach to health care reform. The MS&L replaces insurance pools with a set of financial tools to help people self fund their care. The toolset includes Health Savings Accounts, Loan Reserves, Grants and a new position called a Health Care Advocate.

The MS&L is best understood as an alternative to insurance. The MS&L will have the same amount of money as an insurance company of the same size.

The most important element of this plan is the Health Savings Account. All transactions are cash payments from the savings account to the care provider. People build equity in their account and rewarded for using their health care resources wisely.

Each year, policyholders will purchase a share of a Loan Reserve. The reserves create a lending base for unexpected or preventative care expenses. When borrowers repay loans, the funds flow back into the savings accounts. The loan reserve structure allows MS&L to charge the premium for the loans on the front end. It also allows for a high default rate.

A small number of people have legitimate medical expenses that exceed their ability to pay. To handle this problem, the MS&L holds back a large amount of money to be used to help these people in the form of grants.

The Savings and Loan program allows those who can self-fund their care do so. The program identifies those needing additional assistance and seeks grants.

The most important element of the program is a new position called the Health Care Advocate. The advocate is a clerical position who works with clients to maintain records and develop their savings plan. Advocates can approve loans, and will seek grants when clients have medical expenses that exceed their ability to pay.