When it comes to Medicare in Minnesota, there are over 400 plan combinations that an individual can have. Choices are great but shopping for coverage alone can quickly seem overwhelming. Medicare Savings Account (MSA) plans are yet another option to provide you with benefits with Original Medicare. These plans are considered to be Medicare Advantage but do have different features compared to their counterparts. We will help break down the main differences and what you need to know about Medicare Savings Account Plans.
What do I need to know?
What are MSA plans?
MSA is a type of Medicare Advantage Plan. What is unique about this type of Medicare Advantage is that you can pair it with a stand-alone drug plan or Part D of Medicare. Not all Medicare Advantage Plans allow you to select Part D plans. When enrolling in a Medicare Advantage Plan that does include drug coverage, it is important to know that you are not able to apply for coverage with a Part D Prescription Drug Plan. If you do, you could potentially cancel your enrollment into your health benefits.
What makes them different from other Medicare Advantage Plans?
MSA are unique since they will have a high deductible that is needing to be met before the plan will start sharing the costs of your services. With MSA, you will receive funds annually to help offset the cost of the deductible. The amount you will receive varies depending on the plan selection. This information is shared in the plan’s summary of benefits. The monies that you receive from the plan can be used for any Qualified Medical Benefit that is listed on the IRS Publication 502. Be careful! Not all services listed on publication 502 will count towards your deductible.
What type of benefits do I get with MSA type plan?
MSA are like other Medicare Advantage Plans where they combine your Medicare Part A and Medicare Part B benefits with a private insurance plan. You will find that they have out-of-pocket costs like other Medicare Advantage Plans and typically provide a network to help lower out-of-pocket costs with your doctoring.
Do I have to pay taxes on monies deposited with my MSA plan?
The funds deposited by the plan are not subject to incomes taxes when used on Qualified Medical Benefits. The amount you receive does vary by the plan that you select. Each plan will choose the dollar amount and the custodian of your account. Most plans will provide you with a debit card to pay for services. (It can feel very similar to how Health Savings Accounts function.) It is important to note that not all Qualified Medical expenses will go towards your plan’s deductible. For example, you could use the MSA to pay for dental work, however, the cost of this service would not go towards your plan’s deductible.
Using an Advocate
If you are considering a Medicare Advantage Plan, MSA might be a good fit for you. Speak with the team at Schatz Benefit Group! They are your local Medicare insurance broker that compares all plan options available in Minnesota. Their services come at no cost and do not increase your insurance premiums. Call them for a complimentary review. They speak this language every day and understand that your needs and insurance plans can change each year.