What is a Medical Medicare Savings Account?

Medical Medicare Savings Account (MSA) plans are one of the options of Medicare Advantage plans. Also known as Medicare Medical Savings Accounts, these plans are a combination of a high-deductible health plan (HDHP) and a medical savings account (MSA). These plans are very similar to the Health Savings Account (HSA) plans you can buy outside of Medicare.

MSA plans offer the same coverage as all Medicare Advantage and Original Medicare plans, but with different rules and costs than other plans. Some Medicare MSA plans will also offer coverage for dental, vision, and long-term care outside of normal Medicare coverage.

Medical Medicare Savings Account Part 1: High-Deductible Health Plan

Part of an MSA plan is a high-deductible health plan

The high-deductible health plan portion of a Medical MSA is, in essence, a Medicare Advantage Part C plan. A deductible is an amount you must pay before your plan begins covering healthcare costs. However, this means that until the deductible is reached, the subscriber must pay out-of-pocket expenses for their health care. This means that the subscriber will pay more upfront than with another plan.

The advantage of a high-deductible health plan is that once the health insurance deductible is reached, the plan covers all costs covered by the plan. This means no copayments at receipt of care. Which are included with other Medicare Advantage plans like a PPO or a PFFS.

It is also important to note that MSA plans do not offer prescription drug coverage. If you need this coverage, you will have to join a stand-alone Medicare Part D plan.

Medical Medicare Savings Account Part 2: Medical Savings Account

The second part of an MSA is a special savings account. The plan will deposit money into this savings account that can be used to pay for healthcare before the deductible is reached. Your plan will select a bank where your account will be set up, and then will begin depositing funds into your account.

The plan usually will only contribute a portion of the deductible, so there will still be out-of-pocket expenses to the subscriber. But these costs will not be as high as they are for Private Fee-for-Service (PFFS) plans. The savings account cannot be added to, so any additional costs will need to be paid out-of-pocket. Even with this stipulation, healthcare providers cannot charge more than the approved amount for care received.

Part 2 of a MSA is a medical savings account that uses a special savings account, that the plan contributes to

What Are the Requirements for an MSA Plan?

In order to join an MSA, you must have both Medicare Part A and Part B, otherwise known as Original Medicare. The only time you can join an MSA is when you first sign up for Part B coverage when you age into Medicare. Alternatively, you can also join an MSA during fall open enrollment. 

Usually, a subscriber to an MSA will still have to pay a Part B premium. Some MSA plans will charge an additional premium on top of the Part B costs.

You will not be eligible for an MSA plan if you have any other healthcare coverage or medical benefits from your employer. Additionally, you cannot qualify for Medicaid, and cannot receive Tricare or VA benefits. Finally, you must not have End-Stage Renal Disease or be receiving hospice care.

Looking to get the best healthcare plan for you? Set up a consultation with one of our health advisors today! Call us at 888-218-4543, or set up an appointment right here on our website.

What Are the Costs of MSA Plans?

The main cost for beneficiaries is the high deductible portion of the MSA, before the rest of your expenses are covered by Medicare. The cost will depend on your individual plan. However, beneficiaries do not usually directly pay towards the deductible. With MSA plans, if you are able to cover all of your covered medical expenses with the deposited funds, you won’t be paying towards your deductible. 

On the other hand, if the deposited funds in your account do not cover all of your expenses, you will have to pay out of pocket until you reach your deductible.

Let Us Help You Find The Right Plan

At Buffalo Health Advisors, we believe in providing solutions to seniors as they transition to Medicare plans. Not only can Medicare Advantage work to protect your health, choosing the right plan can go a long way toward protecting your wealth. This plan is critical if you are going to be living on a fixed income during your retirement years.

If you are under the age of 65, we also have options for you. Under certain conditions, you may be eligible for Medicare benefits.

It will cost you nothing to learn more about the options available to you. Call or stop by our Nashville, TN office to discuss your Medicare plan options with one of our experienced agents.

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Compare Medicare Advantage plans to find the best match for your personal needs with no obligation!

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