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ACA Premiums and HSA
Old 10-30-2013, 01:02 PM   #1
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ACA Premiums and HSA

In general paying insurance premiums is not one of the allowed uses of money in HSA.

But the exceptions I have seen are:

a) If you are collecting state or Federal unemployment
b) If you are paying for continuation coverage through COBRA
c) Medicare premiums.
d) Long Term Care Premiums.

It certainly looks like the law tries to make allowance for people who are in distress/poor.

Given the spirit of the law, I would think the same would apply to people under ACA who are eligible for subsidy.

Considering the fact those the plans are much richer than what they were used to including much lowered deductibles, they probably will not have an opportunity to even use their HSA's if they have a decent amount socked away.

Although distress/poor label may not apply, many ER's may come under this category by managing MAGI.

Has anyone seen the text of the law which addresses this issue? Is paying ACA (with subsidy) premiums explicitly prohibited, or is it silent with some wiggle room provided by original text of the HSA law?
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Old 10-30-2013, 01:42 PM   #2
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If I am not mistaken and in general, health insurance premiums are one of the biggest and most important uses of money from an HSA account ! When were health insurance premiums disallowed as a legit HSA expense ?
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Old 10-30-2013, 01:58 PM   #3
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Originally Posted by frayne View Post
If I am not mistaken, in general health insurance premiums is one of the biggest and most important uses of money from and HSA account !
I think you are mistaken and the exceptions 47percent listed are accurate.
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Old 10-30-2013, 02:00 PM   #4
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Originally Posted by frayne View Post
If I am not mistaken and in general, health insurance premiums are one of the biggest and most important uses of money from an HSA account ! When were health insurance premiums disallowed as a legit HSA expense ?
As far as I know, health insurance premiums have always been excluded.
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Old 10-30-2013, 02:27 PM   #5
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I stand corrected. I thought at one time a person could use HSA funds to pay health insurance premiums.
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Old 10-30-2013, 03:51 PM   #6
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It can get confusing since when you are working you are having heath insurance premiums and HSA contributions taken out of your pay, but they are separate streams.
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Old 10-30-2013, 05:52 PM   #7
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Has anyone seen the text of the law which addresses this issue? Is paying ACA (with subsidy) premiums explicitly prohibited, or is it silent with some wiggle room provided by original text of the HSA law?
I haven't seen anything new on this and doubt very much they would allow it. If they did wouldn't they have to allow everyone receiving a subsidy (not just those purchasing an HSA plan) to also be able to deduct their premiums from their taxes? I don't see that happening, after all the point of the subsidy was to make health insurance affordable.
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