Health Savings Accounts & Medicare
HSAs are the optimal way to save for medical expenses in retirement because they offer a triple tax advantage through contributions, interest or investments, and withdrawals for qualified medical expenses. However, because this is a tax-advantaged account, ORNL Benefits wants to make sure you are aware and comply with IRS regulations involving HSAs and Medicare enrollment.
What You Should Know About Working After Age 65
In order to be eligible for HSA contributions (including ORNL’s employer contribution), you as the HSA account holder cannot be enrolled in Medicare. This rule does not apply to your spouse. This is an IRS rule. IRS Publication 969 states that HSA account holders are not eligible to make contributions if they are enrolled in Medicare Part A.
You are eligible to enroll in Medicare at age 65.
However, you do not need to enroll if you’re enrolled in ORNL’s medical plan. This applies to spouses as well.
Delay Medicare enrollment.
ORNL’s Retirement Services department will advise you on the Medicare enrollment steps when you sign retirement paperwork.
Be aware that you will be automatically enrolled in Medicare Part A if:
*You apply for Medicare Part B.
*You start Social Security benefits
*Your spouse starts Social Security benefits based on your income
*Retroactive Medicare Part A enrollment:
When you enroll in Medicare Part A, your Medicare Part A coverage will be retroactively effective up to 6 months before the month you apply for Medicare or start Social Security benefits. However, Medicare Part A will not be effective before your 65th birth month.
Already enrolled in Part A?
Contact the ORNL Benefits office at [email protected] or by calling (865) 576-7766 to discuss your HSA account.
Approaching Retirement?
As you near retirement (preferably 8 months in advance), contact the ORNL Benefits office at [email protected] to review your HSA contribution eligibility. Planning ahead can help you avoid making ineligible HSA contributions and incurring IRS tax penalties.
Tools & Resources
Contact ORNL Benefits
(865) 576-7766
[email protected]