QUESTION

I'm interested in enrolling in a Health Savings Account (HSA)-compatible plan and opening up an HSA. My income is less than 250% of the federal poverty level and I qualify for cost-sharing help through the Marketplace. Can I still have an HSA?

Individuals with coverage | Individual and Marketplace Health Coverage
ANSWER

Possibly. You must have an HSA-compatible health plan to have an HSA. However, because you are under 250 percent of the federal poverty level, you qualify for cost-sharing reductions that could make your plan incompatible with an HSA. Under IRS rules, for a health plan to qualify, the annual deductible must not be less than $1,350 for an individual or $2,700 for a family in 2019. These plans are referred to as High Deductible Health Plans (HDHPs). But for individuals receiving cost-sharing reductions through the marketplace, many plans have low or even zero deductibles, or exempt certain services from your deductible to meet cost-sharing requirements. If your cost-sharing reductions bring your deductible below the deductible requirement under an HSA-compatible plan, then the plan will no longer qualify as HSA-compatible. In this circumstance you can choose whether or not to take the cost-sharing reductions or have a HSA, but not both. (IRS, Rev. Proc. 2018-30).

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