“If we buy a HSA plan for the kids, but a normal plan for my husband and I, can we use the HSA money for our expenses or only for our kids? It is my understanding if we have a HSA plan for me and the kids, but my husband separately (not HSA), he can use the HSA money. Just not sure for a child only HSA.”
Juggling Plans and Accounts
Dear Juggling Plans and Accounts,
For people new to lingo, “HSA” stands for Health Savings Account. It is a tax-free account that a person can have if he/she has a specific type of health insurance plan. These plans are called “HSA compatible”, “consumer driven health plan”, or “high deductible health plan”.
The tax laws for Health Savings Accounts (HSAs) do not provide for a child-only plan. The only way children’s coverage can be through an HSA is on a family plan, or a plan that includes at least one adult.
Technically, the HSA can pay only the expenses for people who are (or were at one time) covered by an HSA-type health insurance plan. If you and the kids had an HSA and the husband had a different plan, the HSA money should only go for yours and the kids’ medical bills. Enforcement of this may be lax, however, allowing you to take money from the HSA for any family member. Some HSAs are managed by banks; others are overseen by the health plan itself. The health plan could much more easily determine whether the bill is for someone covered by the health plan, and refuse your request for your HSA money. I’m not sure how strictly health plans enforce these rules.