Health Savings Account Eligibility Details

Starting a health savings account is one of the best financial decisions you can make. It allows you to put back money in a tax-free account for any qualified medical expenses. As you put money back, you will eventually get to the point where you don't have to worry about medical bills anymore. You will have enough to cover your deductible on your insurance as well as any coinsurance and out-of-pocket expenses. While it is a smart move to start your own health savings account, not everyone is eligible to do so. What determines whether you can start a health savings account? Here are a few eligibility requirements.

High-Deductible Insurance

The biggest criteria of owning a health savings account is that you also have a high-deductible health plan. The government will actually determine on a year-to-year basis what a high deductible is. Therefore, you will have to meet government regulations on your amount of deductible before you know if you are eligible or not. They will have an individual deductible set as well as a family deductible. To determine what the requirement for deductibles is, simply call your local bank or financial institutions. If they offer health savings accounts, they will definitely know the deductible requirements for the current year. Just make sure that your insurance policy falls into this category before you apply for a health savings account. Those with small deductibles may not need an account because they can only pay a small amount of money out of pocket.

Dependent Status

Another requirement for eligibility is that no one else can claim you on your taxes. If you are still living with your parents, the government has determined that you don't need any help on health expenses. You save enough on rent and other expenses to make up for it. Therefore, you cannot be anyone else's dependent to get a health savings account.

Other Insurance Plans

In order to qualify for a health savings account, you cannot have any other health insurance plans besides your current high deductible plan. If you had another first dollar insurance plan, it would pretty much defeat the purpose of saving for your health expenses. You would be paying so much in monthly health insurance premiums, that you would most likely not be able to save anything back anyways.


Another requirement to be eligible for a health savings account is that you cannot be enrolled in Medicare. Medicare covers the majority of your health expenses and you may not even have to pay for it. Therefore, the government doesn't want to give you too many advantages in health care by combining the two.

Losing Eligibility

If you lose eligibility for one of the reasons above, but you have already been contributing to a health savings account, you can regain your eligibility at some point. You can also spend the money in your account on health expenses along the way.

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