The value and benefits of an HSA are hard to pass up. Their short-term and long-term savings options create flexibility to enable an HSA strategy that works best for you. In order to take advantage of these opportunities, you need to be eligible. Here are the requirements to determine your HSA-eligibility.
Health Plan Requirements for HSA Eligibility
- In 2018, your health insurance must have an annual minimum deductible of $1,350 for individuals and $2,700 for families.
- In 2018, the annual out-of-pocket maximum can’t be more than $6,650 for individuals and $13,300 for families. This definition only applies to the in-network services.
- The health insurance plan must be so that the individual/family pays the first cost of healthcare up to the deductible before any kind of insurance kicks in (preventative care excluded from this definition). This includes prescription drugs as well. The deductible and maximum out-of-pocket expenses are indexed annually for inflation.
- Family coverage is determined by having an insurance policy that covers you and at least one other person.
Other Requirements for HSA Eligibility
- You need to have a qualifying High Deductible Health Plan (this essentially means that you have to pay for all covered medical services (except preventative care) before your health insurance kicks in. So no copays or coinsurance before your deductible is met).
- You can’t be enrolled in any other non-HSA qualified health insurance plan.
- You can’t have or be eligible to use a general purpose Flexible Spending Account (FSA). Limited purpose FSAs are allowed for dental, vision, and dependent care if your HDHP doesn’t cover those services.
- You can’t be claimed as a dependent on someone else’s tax return.
- You can’t be enrolled in Medicare (Part A and Part B) or Medicaid.
Each year as you make health plan changes, your HSA eligibility can change, thereby affecting your HSA eligibility. Bookmark this page to ensure when your healthcare and lifestyle changes, your HSA-eligibility doesn’t. Understanding these HSA-eligibility requirements ensure you stay IRS compliant and can take advantage of the laundry list of HSA benefits.
If you need more help with health account decisions, check out our blog. We will make you a healthcare benefits expert in no time, without any extra work or effort on your end.
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