When is a Health Plan HSA Eligible?

A health plan is eligible for a Health Savings Account (HSA) when it meets certain criteria set by the Internal Revenue Service (IRS). To be HSA-eligible, a health plan must be a High Deductible Health Plan (HDHP) that meets specific requirements.

Here are the key guidelines to determine if a health plan is HSA-eligible:

• The insurance plan must have a minimum deductible amount set annually by the IRS.
• The plan must also have a maximum out-of-pocket limit that includes deductibles, co-payments, and coinsurance.
• The plan cannot provide any benefits until the deductible is met, except for preventive care services.

Additionally, individuals covered under the plan cannot be enrolled in Medicare and cannot be claimed as a dependent on someone else's tax return.

If a health plan meets all these criteria, it is considered HSA-eligible, and individuals covered under such a plan can open and contribute to an HSA to save for medical expenses tax-free.

A health plan qualifies for a Health Savings Account (HSA) when it aligns with specific criteria established by the IRS. These plans, known as High Deductible Health Plans (HDHPs), must adhere to particular standards related to deductibles and out-of-pocket limits.