If you’re 65 along with healthy, you may want to check out that will Medicare plan, which includes a tax-favored savings account.
Say hello to the Medicare medical savings account or MSA.
Funds in an MSA accrue interest along with free of taxes. Beneficiaries can make tax-free withdrawals provided the money is actually used for qualified medical costs. Maybe best of all: Medicare seeds the accounts with cash each year.
The account is actually a cousin of the health savings account, which you may know if you have a high-deductible health plan at work.
Despite its virtues, the Medicare MSA incorporates a tiny following.
Of about 19 million enrollees in Medicare Advantage, only 5,000 are in programs that will use an MSA, according to Gretchen Jacobson, associate director with the Kaiser Family Foundation’s program on Medicare policy.
“the idea’s a great product if you have a beneficiary who is actually reasonably healthy along with goes to the doctor just a couple times a year,” said A.J. Tate, director of Medicare product development at MVP Health Care, in Schenectady, completely new York.