Wednesday, September 11, 2019

Medicare MSAs

[Full disclosure: I am not active in the Medicare Supplement/Advantage market]

Recently received this in email:

"New for 2020: Lasso Medicare Savings Account Plan"

Medicare MSA's appear to be the post-65 version of what we typically see as Health Savings Accounts (HSAs) in the pre-65 market, with some interesting twists:
• $0 Premium
• MSAs are one type of Medicare Advantage (MA) plan that the Centers for Medicare and Medicaid Services (CMS) partners with private insurance companies to offer. MSAs combine a high deductible health plan covering Medicare A/B expenses with an IRS-approved trust/ custodial savings account.
• No admin/monthly fees for MSA account while beneficiary is on plan
• See any provider or hospital that excepts [sic] Medicare!
• Individual must enroll in a stand-alone [Part D Rx Plan].
• HSA account funds can transferred into new MSA accounts. 
• Plans are available in every county in the states where they are available [ed: go figure].

I checked with co-blogger Bob V (who's very active in the Medicare market) and he confirmed that the idea is legit.

This particular iteration is intriguing, since the vendor, not the insured, is making the actual deposit. Once that's made into the insured's account, it's immediately vested, and can be used for medical-related items (like doctors' visits and rx co-pays). Since it's 100% the insured's money, there's definitely some 'skin in the game,' and we can see that in action:

"[A]s of September 1, 2019, 81% of all Lasso Healthcare MSA plan members had spent less than $1,000 in their current benefit period!"


[ed: I reached out to see if the insured/beneficiary could also contribute to the account, and will update this post if/when they reply]

Currently, the Lasso plan is available in over 25 states (almost half of them!).

Cool idea.

[Hat Tip: TLC Recruiting]
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