Are Advantage Plans Eligible for HSA Contributions?

Health Savings Accounts (HSAs) provide individuals the opportunity to save money for medical expenses tax-free. One common question many people have is whether Advantage Plans are eligible for HSA contributions.

Advantage Plans, also known as Medicare Advantage Plans, provide comprehensive health coverage that combines services covered by Medicare Parts A and B, as well as sometimes Part D. These plans are offered by private insurance companies approved by Medicare.

When it comes to HSA contributions, it is important to understand the rules:

• Medicare Advantage Plans do not work with HSAs.
• If you are enrolled in a Medicare Advantage Plan, you cannot contribute to an HSA.
• Individuals must be enrolled in a High Deductible Health Plan (HDHP) to be eligible to contribute to an HSA.

However, there are options available for those who are on Medicare and still want to save for medical expenses:

• Individuals who are over 65 and not enrolled in Medicare can continue contributing to an HSA.
• Those who have retired and are no longer contributing to an HSA can still use the funds tax-free for qualified medical expenses.

Health Savings Accounts (HSAs) serve as an excellent resource for individuals seeking to save tax-free for their medical expenses. However, a frequently asked question is whether those enrolled in Medicare Advantage Plans can make contributions to their HSAs.