The Basic Rule: You Need a High-Deductible Health Plan

You can open an HSA only if you are enrolled in a high-deductible health plan (HDHP) — either through your employer, the individual market, or Medicare Advantage. The IRS sets the minimum deductible each year; for 2024, that floor is $1,600 for self-only coverage and $3,200 for family coverage. Your plan must also have an out-of-pocket maximum that does not exceed $4,050 for self-only or $8,050 for family coverage in 2024. These numbers change annually.

You cannot open an HSA if you are on a standard Medicare plan (Parts A and B), Medicaid, TRICARE, or a health plan with a deductible below the IRS minimum. You also cannot have other health coverage that is not an HDHP — for example, you cannot be covered by both an HDHP and a spouse's traditional PPO at the same time.

The HDHP itself does not have to be through your employer. You can buy one on the individual market through your state's health insurance marketplace or directly from an insurer, and you will still be able to open an HSA as long as the plan meets the deductible and out-of-pocket limits.

Key Takeaways

  • You must be enrolled in a high-deductible health plan with a deductible of at least $1,600 (self-only) or $3,200 (family) to open an HSA.
  • You cannot have other health coverage at the same time, except for specific carve-outs like dental, vision, or accident insurance.
  • You cannot be on Medicare Part A or B, Medicaid, TRICARE, or any non-HDHP plan while holding an HSA.
  • Your employer does not have to offer the HSA; you can open one independently if you buy an HDHP on the individual market.
  • You must be a U.S. citizen or resident alien with a valid Social Security number to open an account.

Who Is Disqualified From Opening an HSA

If you claim someone else as a dependent on your tax return, you cannot open an HSA — even if you have an HDHP. This rule applies whether the dependent is a child, parent, or other relative. The IRS treats dependent status as disqualifying because HSAs are designed for individuals and families, not for people who are themselves claimed as dependents.

If you are claimed as a dependent by someone else (usually a parent), you cannot open an HSA either. This affects many people in their early twenties who are still claimed on a parent's return. Once you file your own return and are no longer claimed as a dependent, you become may be able to access.

You also cannot hold an HSA if you are enrolled in any health plan other than an HDHP. This includes traditional employer plans, HMOs, PPOs with lower deductibles, and federal employee plans that are not HDHPs. The rule is strict: you must have HDHP coverage and nothing else (with narrow exceptions for dental, vision, and accident coverage).

Employer-Sponsored HSAs vs. Individual HSAs

If your employer offers an HDHP and an HSA, you can open the account through your employer's plan administrator. Your employer may also contribute money to your account — this is common and counts as tax-free income to you. You do not have to use your employer's HSA provider; you can decline and open an account at a bank or financial institution instead, as long as you remain enrolled in the HDHP.

If your employer does not offer an HSA, or if you buy your own HDHP on the individual market, you can open an HSA at a bank, credit union, or investment firm that offers them. Common providers include Fidelity, Lively, HealthEquity, and many regional banks. You will need your HDHP policy number and proof of enrollment when you open the account.

The timing matters: you can only open an HSA during the months you are enrolled in an HDHP. If you switch to a non-HDHP plan, you can no longer contribute to the account, though you can keep the money that is already in it and use it for medical expenses.

Age and Citizenship Requirements

You must be at least 18 years old to open an HSA. There is no upper age limit — you can open one at any age as long as you meet the other requirements. However, once you enroll in Medicare Part A or Part B, you can no longer contribute to an HSA, even if you also have an HDHP. This is true even if you delay taking Social Security.

You must be a U.S. citizen or a resident alien with a valid Social Security number. Non-citizens without an SSN cannot open an HSA. If you are a resident alien, you will need to provide proof of your status when you open the account.

Special Situations: Spouses and Family Coverage

If you are married and both spouses have an HDHP, each spouse can open a separate HSA. The accounts are individual — you cannot have a joint HSA. Each person contributes up to their own annual limit, and each person controls their own money.

If you have family coverage under one HDHP, only one HSA can be opened for that plan. You and your spouse can decide who owns the account, or you can each open separate accounts if you each have individual HDHP coverage. The person who owns the account is the one who can contribute to it and direct how the money is spent.

If you are married and file taxes jointly, both spouses can have HSAs as long as each is enrolled in an HDHP. If one spouse is on an HDHP and the other is on a traditional plan, only the spouse on the HDHP can have an HSA.

What Happens If You Lose HDHP Coverage

If you switch to a non-HDHP plan — whether through a job change, loss of coverage, or a voluntary switch — you can no longer contribute to your HSA. You stop being may be able to access the month your HDHP coverage ends. However, you keep the money already in the account and can continue to use it for medical expenses for the rest of your life.

If you later re-enroll in an HDHP, you can resume contributing to the same HSA or open a new one. There is no penalty for the gap in coverage, and you do not lose the account itself.

If you are laid off or lose employer coverage, you may be able to open an HSA if you buy an HDHP through COBRA or the individual market. COBRA coverage counts as HDHP coverage if your employer's plan was an HDHP.

Frequently Asked Questions

Can I open an HSA if my spouse is on Medicare?

Yes, as long as you are not on Medicare yourself and you are enrolled in an HDHP. Your spouse's Medicare enrollment does not affect your may be able to access. However, once you enroll in Medicare, you can no longer contribute to your HSA, even if your spouse is still working and on an HDHP.

What if I turn 65 and enroll in Medicare?

You can no longer contribute to your HSA once you enroll in Medicare Part A or Part B. You can still withdraw money from the account for medical expenses without penalty. If you delay Medicare enrollment past 65, you can continue contributing as long as you remain on an HDHP and do not enroll in any part of Medicare.

Can I open an HSA if I am self-employed?

Yes, if you buy an HDHP for yourself on the individual market. You are not required to have employer coverage. You will need to enroll in the HDHP first, then open the HSA at a bank or financial institution. You can contribute up to the annual limit set by the IRS.

Do I need my employer's permission to open an HSA?

No. If your employer offers an HDHP, you can open an HSA through your employer's plan or independently at another provider. Your employer does not control whether you can open an account — only whether you are enrolled in an HDHP.

Can I open an HSA if I am claimed as a dependent?

No. You cannot open an HSA if someone else claims you as a dependent on their tax return. Once you file your own return and are no longer claimed as a dependent, you become may be able to access to open an account.