Reading IRS's document again (Form 8889 instructions). I think the way Turbotax treats it is correct and my original understanding is actually not right.
"If both you and your spouse have HSAs, complete lines 1 through 13 as instructed on the form. However, if you, and your spouse if filing jointly, are both eligible individuals and either of you has an HDHP with family coverage, you both are treated as having only the family coverage plan. Disregard any plans with self-only coverage."
Can anyone confirm?
