Your Health Savings Account (HSA) and Medicare

According to the Internal Revenue Service (IRS) guidelines, you cannot make contributions to your Health Savings Account once you enroll in Medicare. To contribute pre-tax dollars to an HSA you must be enrolled in a High Deductible Health Plan.  The month you begin your Medicare benefits, you should stop making contributions to your HSA.

If you enroll in Medicare, you may keep your HSA if you had it prior to starting your Medicare benefits. The money that remains in your HSA will continue to be tax-free if you use the account for qualified medical expenses.

Examples of Qualifying Medical Expenses:

  • Medicare Part B, C and D premiums
  • Deductibles for all parts of Medicare
  • Dental Expenses
  • Vision Care Expenses
    (well eye exams aren’t covered by Original Medicare)

 You cannot use your HSA to pay for a supplemental (Medigap) policy.

Other Common Questions

Can you keep contributing to your HSA if you are eligible for Medicare, but you are going to remain on your employer’s insurance plan until you retire?

Yes. If you are eligible for Medicare but do not enroll, you can continue to place money into your HSA. Once you enroll in ANY part of Medicare, you will no longer be able to contribute to your HSA.

If your spouse is covered on your health insurance plan, can you still contribute to your HSA plan if your spouse is enrolling in Medicare and dropping from your health insurance plan?  

Yes, because you are the owner of the HSA.  Your spouse can be enrolled in Medicare, and it would not keep you from contributing to your HSA. Once you start Medicare, the contributions into your HSA will have to stop.