This article was updated on June,19 2020.
The healthcare budget has become a huge talking point for the 2020 presidential election. Trump has been accused of not representing senior Americans and consequently continues to lose the senior vote. Before you vote, be sure to read the fine print of President Trump’s 2021 Medicare budget proposal.
Here’s the scoop
Hidden in the depths of the Trump budget proposal for fiscal year 2021 are two additional changes to Medicare. These proposed changes may have not made national headlines, but they could give Medicare beneficiaries more options in how they finance their healthcare.
Opting out of Medicare Part A
Medicare Part A (hospital insurance) is premium-free for most Americans who have worked more than 10 years, and comes with an automatic enrollment when you turn 65. Anyone who wants to collect their Social Security benefits before 65 will automatically be enrolled in Part A as well.
However, if a person has creditable insurance (like through an employer) and they want to collect Social Security without being enrolled in Part A, they cannot currently do this without major financial complications. One such complication is the demand to repay the Social Security Administration all the money they’ve received including any money spent on their healthcare.
This change would make it easier for people to collect Social Security and opt out of compulsory Medicare Part A coverage.
Contributions to HSAs with Medicare
Health Savings Accounts (HSAs) are offered alongside high-deductible health plans. These plans allow consumers to put money into this savings account tax-free in order to save for their medical expenses.
Currently, anyone with a Medicare plan cannot contribute to an HSA, even if they are only enrolled in Part A. The Trump budget proposal change would allow beneficiaries to make contributions to HSAs for high-deductible Medicare Advantage plans, of which there are about 6,000 in the country.