HSA and Medicare

One of the most common questions regarding Health Savings Accounts asked by participants nearing retirement age is whether one can participate in an HSA while enrolled in Medicare. In short, when you enroll in any part of Medicare, you are no longer eligible to contribute to your HSA nor can you receive contributions into your HSA from any source, including your employer. You are, however, still able to withdraw from your HSA and use the money in your account for eligible expenses.

Q: What if you qualify for Medicare but have not enrolled?

If you qualify for Medicare but have not applied, you can continue to contribute to your HSA past age 65; you must simply postpone applying for Social Security and Medicare until you stop working. As long as you maintain your current health coverage, there are no penalties for delaying your application.

Q: Can you contribute to an HSA if your spouse is enrolled in Medicare?

Yes. The ability to contribute to an HSA is determined by the eligibility of the HSA account holder not the account holder’s dependents, even if the dependent is covered under the same health insurance plan. If your spouse is enrolled in Medicare, it does not disqualify you from being able to contribute to your HSA. If your coverage level changes as a result of your spouse enrolling in Medicare (e.g. moving from Family to Individual coverage), though, it will affect the maximum amount you are eligible to contribute to your HSA in a tax year.

More detail on IRS regulations surrounding HSAs and Medicare can be found in IRS Publication 969.