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February 3, 2022
Medicare MSA Funds: What You Need to Know

Medicare MSA Funds: What You Need to Know

One of the ways Medicare Advantage companies are helping seniors manage healthcare costs is through Medicare Medical Savings Account (MSA) plans.

We’re going to explore what that means, what MSA funds can be used for, and where to look for Medicare Advantage MSA options.

What is a Medicare Medical Savings Account?

Medicare Medical Savings Accounts (MSAs) are similar to the Health Savings Accounts you may be used to.

An MSA is a specialized account that the insurance company preloads on January 1st with a deposit. You can use that deposit specifically for medical expenses.

What are MSA funds?

MSA funds come from your Medicare Advantage plan. When you enroll in a MSA plan, you will be selecting a high-deductible MA plan. Medicare gives your MA plan a certain amount of money each year.

In MSA plans, part of that Medicare money is deposited to your MSA account. This amount, which helps cover the deductible difference, is then yours to use at your discretion, as long as you use it for qualified medical expenses.

What can I use my MSA funds for?

MSA funds can be used for medical costs. Here are some common examples of medical expenses you can pay for using MSA funds:

  • Doctor visits
  • Lab work
  • X-rays
  • Inpatient hospital stays
  • Preventative screenings
  • Eyeglasses and contacts
  • Dental cleanings

All Medicare-approved services and item count toward your deductible. Any qualified medical expenses that are not approved by Medicare (like dental and vision care) will not count toward your deductible, but you can still pay for them using your MSA funds.

You can view a list of qualified medical expenses on the IRS website.

Can I use my MSA funds on things not traditionally covered by Medicare, like vision or dental?

One of the largest draws many find to the MSA plan model is the flexibility it allows. You can use your MSA funds as you wish. That might be for dental care, vision care, or other types of care not traditionally covered in Medicare Parts A and B.

Just be aware that if it is not covered by Medicare, it will not count toward your deductible.

What happens to MSA funds at the end of the year?

Unlike other health savings options, Medical Savings Account funds can rollover into the next calendar year. If you do not use all the funds in your account and are staying on that plan for the next year, those funds will automatically carry into the new year.

Are MSA plans available with all carriers?

Medicare Medical Savings Accounts are a relatively new development in Medicare options. That means, for the most part, they are only being offered by select carriers.

As of the release date of this article, one of the only national carriers with MSA options is Lasso Healthcare. But it is very possible we will see more products like this hitting the market in the upcoming years.

Lasso Healthcare 2022 plan options. Deposit and deductible amounts shown above are full calendar-year amounts, based on a January 1 effective date. If you enroll for a partial calendar year, the deposit and deductible amounts will be prorated based on the month your coverage becomes effective with Lasso Healthcare MSA.

How can I find an MSA plan?

MSA plans are still emerging options, which means they might not be available everywhere yet. Because of that, we recommend speaking with an agent here at Medicare Allies to make sure there are plans available in your county. Give us a call at 833-801-7999!

Conclusion

Medicare Medical Savings Accounts are a growing option for many seniors wanting flexibility in their healthcare coverage. Because the funds are yours to use as you see fit, you can maximize your medical coverage with ease.

It can be a great plan option for many who have specialized needs or want to have extra healthcare funds available to help with medical finance concerns.

The best way to learn if MSA plans are available in your area is to reach out and talk to one of our agents.

Want to know more about how MSA plans work? Check out this guide to MSA plans.

Luke Hockaday
By
Luke Hockaday
Luke Hockaday is a Customer Success Rep here at Medicare Allies. Luke has been helping Medicare-eligible clients with their insurance and retirement-planning needs since 2011. Luke is passionate about 3 things, and 3 things only: senior insurance, football, and food!

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