A Medicare Medical Savings Account (MSA) plan is a type of Medicare Advantage plan that does not include prescription drug coverage (MA) - but you are permitted to join a stand-alone Medicare Part D drug plan (PDP) for your prescription coverage.
The Two Parts of a Medicare Medical Savings Account
Unlike other Medicare Advantage plans, Medical Savings Account plans are made up of (1) a high-deductible health plan for your Medicare Part A and Medicare Part B coverage and (2) a medical savings account funded by an annual tax-free deposit.
This means that you can first use the money in your savings account to pay for Medicare Part A and Medicare Part B expenses, and when your MSA deductible is met, the MSA plan pays for any further Medicare-covered services.
Please note, the annual MSA deductible varies by plan.
The Two Parts of a Medicare Medical Savings Account
Unlike other Medicare Advantage plans, Medical Savings Account plans are made up of (1) a high-deductible health plan for your Medicare Part A and Medicare Part B coverage and (2) a medical savings account funded by an annual tax-free deposit.
This means that you can first use the money in your savings account to pay for Medicare Part A and Medicare Part B expenses, and when your MSA deductible is met, the MSA plan pays for any further Medicare-covered services.
Please note, the annual MSA deductible varies by plan.
Adding Medicare Part D Drug Coverage to an MSA
As noted, since, MSAs do not include Medicare Part D prescription drug coverage, MSA members can enroll in any available stand-alone Medicare Part D plan (PDP) for their drug coverage.
Recent changes expanding the MSA Landscape
In past year, MSAs were available only on a limited basis across the country.
For example, in 2018, MSAs were available to Medicare beneficiaries in only 111 counties across two (2) states. In 2022, Medicare Medical Savings Accounts were available in 39 states (2,364 counties) across the country - an increase over 2021 Medicare Medical Savings Accounts available in 2,337 counties across 38 states - and 2021 was an increase over 2020 Medicare Medical Savings Accounts that were available to in 1,883 counties located in 29 states. In 2023, Medicare Medical Savings Accounts were available to millions of people in 37 states (2,313 counties) across the country, including 27 Alaskan counties (the only Medicare Advantage plan options in Alaska). Two states, New York and Vermont offered MSAs in 2022, but will not offer MSAs in 2023. Then, in 2024, the MSA market shrank - having only a single MSA plans available to residents of 72 counties in Wisconsin and this remains for 2025.
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(sources include: Medicare.gov and on this site Team)
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