The VEBA account can be used to pay for qualified medical expenditures, such as the premium cost of continued employer-provided health coverage or Medicare coverage. The VEBA account reimburses medical expenditures like as deductibles, co-pays, or co-insurance, as well as prescription medicines. Generally, Medicare covers these expenses at 100%. However, some premiums, costs that do not qualify for reimbursement, and some deductible/co-pay amounts may not be covered by Medicare. For example, if you have a $10,000 deductible under your plan year 2012 policy, then you would need to save $100,000 in order to be able to cover that expense out of pocket. Since most people cannot afford to put away $100,000 before the plan year starts, their providers will not see any money to cover their services. In this case, you would need to find other sources of income or credit cards could be used to pay for your deductible. Similarly, if your plan year 2012 policy has a 20% co-payment, then you would need to save $120,000 in order to be able to cover that expense out of pocket. Since most people cannot afford to put away $120,000 before the plan year starts, their providers will not see any money to cover their services. In this case, you would need to find other sources of income or credit cards could be used to pay for your co-payment.