How Do I Know If a Health Plan Is HSA Eligible?

One of the key benefits of a Health Savings Account (HSA) is the ability to pair it with a high-deductible health plan (HDHP). But how do you determine if a health plan is eligible for an HSA? Here are some key points to consider:

1. High Deductible Health Plan (HDHP) Criteria:

• To be HSA eligible, your health plan must meet certain criteria set by the IRS. For 2021, the minimum deductible for an HDHP is $1,400 for an individual and $2,800 for a family.
• The out-of-pocket maximum limit for 2021 is $7,000 for an individual and $14,000 for a family.

2. HSA Compatibility:

• Check if the health plan specifically states that it is HSA compatible. This information is usually provided by the insurer or employer offering the plan.
• Verify that the plan does not cover non-preventive medical expenses before the deductible is met, except for certain preventive services as permitted by the IRS.

3. Consult Your Employer or Insurer:

• If you are unsure whether your health plan is HSA eligible, reach out to your employer's HR department or the insurance provider for clarification.

By understanding the criteria and checking compatibility, you can determine if a health plan is eligible for an HSA, allowing you to take advantage of the tax benefits and savings it offers.

Understanding whether a health plan is HSA eligible is crucial for maximizing your health savings. The first thing to examine is whether the plan is categorized as a High Deductible Health Plan (HDHP) according to the IRS guidelines.

1. High Deductible Health Plan (HDHP) Criteria:

• For 2023, the required minimum deductible has increased to $1,500 for individuals and $3,000 for families.
• Be aware that the out-of-pocket maximum for 2023 is capped at $7,500 for individuals and $15,000 for families.

2. HSA Compatibility:

• It’s essential to confirm that the plan mentions it is designed to work with an HSA. This can typically be found in the plan details provided by your insurer.
• Additionally, ensure no non-preventive services are covered before the deductible threshold, with exceptions for IRS-approved preventive care.

3. Consult Your Employer or Insurer:

• If there are any doubts regarding your plan’s HSA eligibility, contacting your HR department or insurance agent is a smart move for clarity.