If I Have Tricare Can I Open an HSA?

After a previous post which discussed whether or not a veteran can get an HSA I have been getting asked if you can open an HSA if you have Tricare.

The answer to your question is:

No, you can not open an HSA if you have Tricare.

The reason you are not able to open an HSA if you have Tricare is because you are not an eligible inidividual and therefore you do not qualify for an HSA.  According to IRS Publication 969 in order to qualify for an HSA:

  • You must be covered under a high deductible health plan (HDHP), described later, on the first day of the month.
  • You have no other health coverage except what is permitted under Other health coverage, later.
  • You are not enrolled in Medicare
  • You cannot be claimed as a dependent on someone else’s 2013 tax return.

Your Key Disqualifying Factor

If you have Tricare, then your key disqualifying factor is that you are not covered under a high deductible health plan.  This is due to the fact that Tricare is a low-deductible health plan.

If you were thinking of getting a HDHP in addition to Tricare, so you would qualify, think again.  You might have a HDHP, but your Tricare coverage would be considered other coverage and if you look at the list above you will see that you are only permitted to have a HDHP and no other health coverage.

If you read the second part of the second bullet you will see that there are some health coverage that is exempt from this rule, but Tricare doesn’t fall underneath any of these categories.

Final Thoughts

Just because you aren’t eligible to open an HSA right now because of your Tricare coverage, doesn’t mean that you will always be ineligible.  If you ever lose your Tricare coverage and as long as you meet all of the other requirements listed in the IRS Publication 969 then you would be able to at that time open an HSA.

2 comments… add one
  • Tara Oct 29, 2015 @ 2:19

    It’s really frustrating to have the opportunity to have a HDHP through my spouse’s job, but since we are auto-enrolled in Tricare, we are unable to take that option. So instead, we pay more for Tricare Prime since that is the only way to keep our costs less than 90/10 deductible. Way to go government – you disadvantage our veterans once again. I’d love to know if anyone is trying to get this changed?!

    • Thomas Dec 11, 2015 @ 2:28

      Yeah, it sucks. I think they look at it as “double-dipping”. From the governments perspective they probably see it as the government already gives retirees access to Tricare, so why would they give them a tax break for an HSA? I’m not saying that’s right, probably just their point of view.

      I’m not sure if anyone is trying to get that changed. You can always reach out to your Congressman about it. How effect that will be, I have no idea.

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