Health Savings Account Help
- Covered under a high deductible health plan (HDHP) on the first day of the month
- Generally not covered by any health plan that is not an HDHP (exceptions exist for coverage that is not part of an HDHP for accidents, disability, dental care, vision care, long-term care, or permitted insurance)
- Not enrolled in Medicare
- Not able to be claimed as a dependent on another person’s tax return
Yes. A network plan is a plan that generally provides more favorable benefits for services provided by its network of providers than for services provided outside the network. When determining if a plan is an HDHP, the out-of-pocket expense limits for services provided outside of a network of preferred providers are disregarded. In other words, if a plan otherwise meets the requirements of an HDHP, but the out-of-pocket expense limits for out-of-network services exceed the maximum annual out-of-pocket expense limits allowed for an HDHP, the plan will still be considered an HDHP.
EXAMPLE: Is the plan described below an HDHP?
Sarah has self-only coverage under her health plan for 2019. She may access services from either a network of preferred providers, or she may choose to receive services from out-of-network providers. When she uses in-network providers, her health plan has a $1,350 deductible and a $4,000 out-of-pocket expense limit. Alternatively, when she accesses services from out-of-network providers, her deductible is $2,000, and her out-of-pocket expense limit is $12,000.
Answer: Yes. Sarah’s plan is an HDHP because it meets the deductible and out-of-pocket expense restrictions for self-only coverage when she uses network providers. Out-of-network provider expenses are disregarded when determining if an individual has an HDHP.
Any or all of the following are eligible to contribute to an HSA in a given year.
- An eligible individual (defined earlier)
- An eligible individual’s employer (if applicable)
- Any other person
General rule: For an eligible individual that is covered by the same HDHP plan for the entire calendar year, the maximum annual contribution is the statutory limit of $3,450 in 2018 for those with self-only coverage, or $6,900 for those with family coverage. An HSA owner is treated as being covered by the same HDHP coverage (self-only or family) for the entire year as the coverage held on December 1.
NOTE: Contribution amounts may be adjusted for cost-of-living increases.
Contributions may be made by or on behalf of an eligible individual even if the eligible individual has no compensation, or the contributions exceed his or her compensation.
Catch-up contributions: Eligible individuals may make HSA catch-up contributions of up to $1,000 annually. For eligible individuals who are married and have family coverage, each spouse who is an eligible individual may make a catch-up contribution to his or her own HSA.
If an eligible individual will attain age 55 or older by the end of the calendar year, and he or she is an eligible individual for the entire year, he or she may make a full catch-up contribution.
HSA eligibility is determined on the first of each month. If an HSA owner changes HDHP coverage from self-only to family or family to self-only, she can add up the monthly limit for each month she was covered to determine her annual contribution limit, or she can determine her contribution limit as if she was covered by the same HDHP coverage for the entire year as the coverage held on December 1. With this rule, the HSA owner may increase, but does not have to decrease the contribution limit. For example if an HSA owner has self-only coverage throughout 2018, but switches to family coverage on November 1, 2018, and has family coverage through December 31, 2018, the HSA owner’s contribution limit is the family coverage contribution limit ($6,900 for 2018).