Can I Have an HSA While on Medicare?
You can keep an existing HSA and spend the money, but you cannot make new contributions once you are enrolled in any part of Medicare (including Part A). This applies to both your own contributions and your employer's payroll contributions — both must stop.
Frequently Asked Questions
- Can I pay Medicare premiums with HSA money?
- Yes. You can use HSA funds to pay Medicare Part B, Part D, and Medicare Advantage premiums tax-free. You cannot use them for Medigap premiums.
- What happens to my employer's HSA contributions?
- Your employer's payroll contributions to your HSA must also stop once you enroll in any part of Medicare. Both employee and employer contributions are subject to IRS excess contribution rules if deposited after Medicare enrollment begins. Coordinate with your HR department or payroll provider, and if excess contributions have occurred, speak with your payroll department, HSA custodian, or a tax professional about correcting them.
- When exactly should I stop HSA contributions?
- Stop all contributions — both your own and your employer's payroll contributions — at least 6 months before you plan to retire, apply for Medicare, or apply for Social Security or Railroad Retirement benefits. This protects you from Part A's retroactive coverage, which can reach back up to 6 months.