About Medicare MSA Plans

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A Medicare Medical Savings Account (MSA) Plan is a type of healthcare insurance plan provided by private companies. It offers a savings account with a high-deductible health plan, where people can use their savings to pay for health coverage. Once they reach their deductible, enrollees will receive health coverage through a high-deductible insurance plan, similar to Health Savings Account Plans.

How Does it Work?

MSA Plans include the same coverage as other Medicare Advantage Plans. Enrollees can expect to receive cover for general healthcare costs and prescription drug costs but not vision, dental, hearing, or wellness programs. However, some MSA Plan providers might offer these services for an additional fee.

There are two parts to MSA Plans:

  • Medical Savings Account: This part is essentially a savings account where the MSA Plan provider deposits money to cover a person's healthcare and prescription drug costs before they reach their yearly deductible.

  • High-Deductible Plan: This part is a type of high-deductible Medicare Advantage Plan, where enrollees receive healthcare coverage once they meet a yearly deductible (this amount depends on the MSA Plan provider).

In order to qualify for an MSA Plan, a person needs to have Medicare Parts A and B. Usually, enrollees will continue to pay their Medicare Part B premium when they take out an MSA plan.

What are the Benefits of MSA Plans?

Medicare MSA Plans provide enrollees with a financial safeguard in the event of expensive healthcare bills.

People have the option to shop around for the best MSA Plans as various private companies offer this service.

What are the Drawbacks of MSA Plans?

Enrollees can't deposit their own money into their MSA savings account. Once they have used the available funds, they will need to pay out-of-pocket for any healthcare expenses until they reach their yearly deductible. These out-of-pocket expenses can be costly.

Medicare MSA Plans provide people with the coverage they need to meet healthcare and prescription costs. Unlike other types of Medicare Advantage Plan, enrollees will receive money from a private company in a special savings account before they reach their yearly deductible.