Can I enroll in HSA eventhough my wife has Medicare disability? The ins. plan is under my name(family plan). I would like to contribute to pay for all medical expenses?

[LouisR]

I am enrolled in a high deductible medical plan at work and would like to contribute to an HSA.  My wife has disability medicare coverage which we are told cannot be enrolled in HSA.  From what i read, if the primary insurance holder (which is myself) does not have a secondary insurance, then we can enroll in an HSA.  Can anyone please provide me an accurate response and if there is an IRS documented policy which would support being able to participate in an HSA with a spouse who has medicare.  

THANK YOU!!

[dmertz · Accepted solution]

HSA accounts are individual accounts and eligibility to make an HSA contribution depends on the individual account holder's health insurance coverage.  Your wife's Medicare coverage prevents her from being an individual eligible to contribute to an HSA but it has no effect on your eligibility for you to contribute to your HSA.

See IRS Pub 969:  https://www.irs.gov/publications/p969/ar02.html#en_US_2016_publink1000204025

("You" in this reference is referring to a particular individual.)

[LouisR]

Thanks for the super quick reply and great reference link.  So i can contribute and pay for her medical expenses from my HSA account, correct?  Thanks again!

[dmertz]

Correct.

[Patricia2]

I currently contribute to an HSA through my employer.  My spouse is on my insurance, but also enrolled in Medicare Part A when he turned 65 last year.  I was told I could only contribute a maximum of $3,500 (self-only) since he is now on Medicare Part A.  Can you verify if this is correct?  

[dmertz]

Patricia2, what you were told is not correct.  Your husband's ineligibility to contribute to his own HSA has no effect your contribution limit to your own HSA.  Your contribution limit is based on your HDHP plan providing family coverage (i.e, not self-only coverage) so you are permitted to contribute to your own HSA up to the family limit (plus your own catch-up contribution if you are age 55 or over). 

[makmak3030]

What about if I am the one who carries the HDP and have Medicare? Can my Husband still have an HSA and contribute to it? Or does the HSA have to be in the name of the person under whose name the Insurance is?  Thanks

[dmertz]

The HSA does not have to be in the name of the person with the HDHP insurance.  The person contributing to the HSA just has to be covered by the HDHP insurance and not also covered by any disqualifying insurance or Medicare.  If the HDHP plan is in your name and your husband is covered by the plan, your husband can contribute to his HSA provided he does not have disqualifying coverage.

[gulfer]

Can I pay the Medicare premiums (part B and/or part D) for my spouse under age 65 disabled with medicare  out of my HSA account? This isn't clear in the IRS publications. It only refers to spouse age 65+. Anyone know?

[gulfer]

I am under age 65, we both are.

[Anonymous]

dmertz, thank you for reply to this question. It has been a source of great frustration for me last few weeks. Unfortunately, I continue to get conflicting responses. My employer sides with you, in that I can continue to contribute the maximum family amount to my HSA as I am covering both my husband and myself on MY HSA and HDHP (My husband is enrolling in medicare part A next year AND staying on my employer plan with me). However, Optimum, the HSA company is insisting this is incorrect. They pointed me to the IRS publication 969, where I was still NOT able to confirm either theory. Do you have a source where I can reference that MY contributions can stay as family if my husband is on Medicare (and it's just him and I on the HDHP)?  thank you so much.

[dmertz]

An individual is subject to the family limit if that individual is an eligible individual and the plan that covers that individual also covers at least one other individual, whether or not that other individual is eligible to contribute to an HSA.  However, it's often the case that the a plan that originally covered both spouses switches to self-only coverage when one of the spouses becomes covered by Medicare and the self-only limit would apply to that month and beyond, but an automatic switch to a self-only plan upon one spouse becoming covered by Medicare depends on the terms of the particular plan.  Section 223(c)(4) of the tax code defines "family coverage" as any coverage other than self-only coverage.