Can You Have an HRA and an HSA? Understanding the Basics of Health Savings Accounts

Health Reimbursement Arrangements (HRAs) and Health Savings Accounts (HSAs) are both tax-advantaged accounts that can help you save money on medical expenses, but there are some key differences between the two.

One common question people have is whether they can have both an HRA and an HSA. The short answer is yes, but there are some restrictions and considerations to keep in mind:

• Employer Contribution: You cannot contribute to both an HRA and an HSA simultaneously if your employer contributes to both accounts on your behalf.
• Coordination of Benefits: If you have an HRA that covers qualified medical expenses before your HSA coverage kicks in, you may face limitations on HSA contributions.
• Qualified High Deductible Health Plan (HDHP): To be eligible for an HSA, you must be enrolled in a Qualified HDHP and cannot be covered by a general health FSA or HRA.
• Dual Eligibility: If you have both an HRA and an HSA, you will be considered dual-eligible, which may impact your HSA contribution limits.

It's essential to understand the rules and regulations surrounding HRAs and HSAs to ensure you are maximizing your healthcare savings potential while remaining compliant with IRS guidelines.

Health Savings Accounts (HSAs) and Health Reimbursement Accounts (HRAs) can both be beneficial for managing healthcare costs, and yes, it is possible to have both accounts concurrently, provided you understand the nuances involved.