Health Savings Accounts - Part 2, HSA Eligibility
By John Silvers
This is the second article in a four-part series on Health Savings Accounts.
By law, HSAs are available to individuals who are:
- Covered by an HDHP (this will be discussed further in our next issue)
- Not covered by other health insurance
- Not enrolled in Medicare
- Cannot be claimed as a dependent on someone else s Federal tax return
- Children cannot establish their own HSA s, but have medical coverage under a family plan
- Spouses can establish their own HSA, if eligible
Other health insurance that will preclude eligibility for an HSA include the following:
- Medical coverage by a non-HDHP
- Medicare (Part A and/or Part B)
- TRICARE
- Any VA benefits used in previous 3 months
- Health Care Flexible Spending Accounts (HCFSA) - Limited HCFSA is permitted (see below)
Certain types of insurance are not considered “health insurance” and will not jeopardize your eligibility for an HSA. These include:
- Dental Care
- Vision Care
- Disability
- Accident
- Long-Term Care
- Life
- Specified Disease or Illness
- Insurance that pays a fixed amount per day for hospitalization
- Limited Health Care Flexible Spending Accounts (HCFSA)
Individuals can have both and HSA and an HCFSA, but only under certain circumstances. General Flexible Spending Arrangements (FSAs) will probably cause your employees to be ineligible for an HSA. However, offering employees a “limited purpose” (limited to dental, vision or preventive care) or “post-deductible” (pay for medical expenses after the plan deductible is met) FSA, will still permit eligibility for an HSA.
In our next newsletter, we will discussadditional details on the High Deductible Health Plan (HDHP) component of an HSA Plan.
http://www.groupbenefitsinsurance.com/
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Health Savings Accounts - Part 3 - High Deductible Health Plan (HDHP)
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Health Savings Accounts (HSA): How Do I Tell a Good One from a Bad One?
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Health Savings Accounts (HSA): Do They Vary From State to State?
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Health Savings Accounts - Part 4 - HSA Contributions & Withdrawals
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Health Savings Account (HSA): Do I Lose It At the End of Each Year?
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