A Medical Savings Account (MSA) is a tax-exempt trust or custodial account established with a financial institution to pay qualified medical expenses. MSAs must be used in conjunction with high deductible healthcare insurance. MSA funds are available to pay medical expenses not covered by the taxpayer’s high deductible medical insurance. Amounts not used for medical expenses belong to the taxpayer and are treated similarly to funds in an IRA. Like an IRA, contributions to an MSA are 100 percent tax deductible and investment income earned by the MSA is tax deferred.