How does a Medicare Medical Savings Account Plan work? Does it gain interest? Is the tax deductible for this type of plan?
With Medicare Medical Savings Account, you get to save money to spend exclusively for your medical needs. It functions much like a supplemental health insurance plan. MSA is both a health plan and a savings account. You are qualified to open an MSA when you turn 65 years old or when you already have a Medicare plan. However, if you have Medicare because of disability or disease, you can also enroll in MSA after the 25th month of receiving disability benefits from Social Security. Seniors can open an MSA within three months before and three months after their 65th birthday. However, if your birthday falls between November 15 and December 31, the enrollment takes effect on the first day of the following year. If you are still employed and your Medicare Plan is sponsored by the company, you are then qualified for the special enrollment period set by the company. The MSA plan will begin covering your health care expenses when you meet the yearly deductible. You can choose to use the savings account to pay for medical needs even before you meet the deductible. As long as the money is spent for medical needs, the savings account is not taxed. When you have chosen the high-deductible Medicare Advantage Plan, you will have to open a Medical Savings Account with the bank listed in the plan. The plan will then deposit an amount according to the policy to spend for your health care. When you have used up all the money for any medical needs, you will have to shoulder the costs the next time you use another health service. You have to pay out of pocket until you reach your plan’s deductible for Medicare-covered services. Remember, though, that health care providers cannot charge you more than what is set by Medicare. Medicare Medical Savings Account Plan accumulates every year. Answer by general public - June 26, 2009 @ 1:26 pm No CommentsNo comments yet. Leave a comment |
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Private health insurance companies offer Medicare Medical Savings Account Plan (MSA) as another option under the Medicare Advantage Plan. If you are familiar with Health Savings Account, MSA works almost like that.
