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Medicare and Health Care


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someoldguy  
#1 Posted : Sunday, December 6, 2020 5:33:16 AM(UTC)
someoldguy

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Here's a little known fact (at least it was unknown to me): If you have a High Deductible Health Plan (HDHP) with a Health Savings Account (HSA) then you cannot have secondary coverage, such as being covered by your spouse's plan.

Has anyone else run into this?

I used to work for a company that was pitching the HDHP/HSA hard... another place made it the default coverage for everyone... but I never heard this bit of news. Yet it is right there in the IRS rules.

I wonder how they enforce this?
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OUtside  
#2 Posted : Sunday, December 6, 2020 11:08:30 AM(UTC)

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I'm still learning about this type of plan but it seems that if it works well for the subscriber, it is a very good deal to receive pre tax funds in an account to which the subscriber him/herself can also make pre tax contributions all of which will never be taxed if used for qualified health care expenses now or into indefinite future. So, if there is a requirement that subscriber cannot also have other insurance going for him/herself at the same time, that seems like a reasonable requirement.

As for enforcement, most brochures I have read tell subscriber to advise the plan what other coverages they have and even if this were missed, when subscriber gives i.d. cards to health care provider when seeking care, the insurance companies are going to know who all the players are, primary, secondary, and which if any are not going to pay, according to the rules.
someoldguy  
#3 Posted : Sunday, December 6, 2020 11:40:05 AM(UTC)
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Originally Posted by: OUtside Go to Quoted Post
As for enforcement, most brochures I have read tell subscriber to advise the plan what other coverages they have and even if this were missed, when subscriber gives i.d. cards to health care provider when seeking care, the insurance companies are going to know who all the players are, primary, secondary, and which if any are not going to pay, according to the rules.
That's true but how does the IRS find out? It is their rule.

Not that I am advocating trying to game the system but I do know a couple folks who have these plans who also have Tricare which does not get any kind of special treatment.



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OUtside  
#4 Posted : Sunday, December 6, 2020 9:22:41 PM(UTC)

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I think if the subscriber to a high deductible plan is not eligible for an HSA, the subscriber gets an HRA, which is similar but does not have the tax advantages and the HRA account cannot be taken out when the subscriber leaves the plan or retires, and also cannot be converted into an IRA at retirement.

I'm not too familiar with the subject but I googled whether having Tricare means not being eligible for an HSA, and I think it does mean that.
upandup  
#5 Posted : Monday, December 7, 2020 10:45:26 PM(UTC)

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Originally Posted by: someoldguy Go to Quoted Post
Here's a little known fact (at least it was unknown to me): If you have a High Deductible Health Plan (HDHP) with a Health Savings Account (HSA) then you cannot have secondary coverage, such as being covered by your spouse's plan.


You can have a high deductible health plan and even maintain and use an existing HSA. You cannot make contributions (or have plan or employer contributions) to an HSA if you have other coverage.

One way to get caught is during tax season when the tax forms that HSA's generate are used on tax returns. In that case, excess/ineligible contributions would require a withdrawal, income tax payment, and the payment of penalty excise tax.
upandup  
#6 Posted : Monday, December 7, 2020 10:46:34 PM(UTC)

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Originally Posted by: someoldguy Go to Quoted Post

Not that I am advocating trying to game the system but I do know a couple folks who have these plans who also have Tricare which does not get any kind of special treatment.

You can have Tricare and have an HDHP and get the plan contribution to an HRA. You cannot have an HDHP and make or receive new HSA contributions.
someoldguy  
#7 Posted : Tuesday, December 8, 2020 1:19:54 PM(UTC)
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Originally Posted by: upandup Go to Quoted Post
You can have Tricare and have an HDHP and get the plan contribution to an HRA.
Thanks, I will have to go look at the IRS site again to make sure I am reading it correctly.

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upandup  
#8 Posted : Tuesday, December 8, 2020 5:58:27 PM(UTC)

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Originally Posted by: someoldguy Go to Quoted Post
Originally Posted by: upandup Go to Quoted Post
You can have Tricare and have an HDHP and get the plan contribution to an HRA.
Thanks, I will have to go look at the IRS site again to make sure I am reading it correctly.



Here is a good video on HRAs from GEHA https://www.youtube.com/...mp;ab_channel=GEHAhealth
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