Medicare and your HSA

Medicare and HSA contributions don’t mix

The rule catches a lot of people: the moment you’re enrolled in any part of Medicare, including premium-free Part A, you lose your eligibility to contribute to a health savings account. You keep the account and can spend what’s in it, but new contributions have to stop. That’s why enrolling in Part A "just because it’s free" can be the wrong move if you’re still funding an HSA.

The six-month lookback

When you enroll in Medicare after 65, Part A coverage is backdated up to six months — though never before the month you turned 65. Claiming Social Security at or after 65 enrolls you in Part A automatically, with the same backdating. So if you keep contributing right up until you enroll, those last six months of contributions can become excess and have to be undone. The fix is simple: stop funding your HSA at least six months before you sign up for Medicare or file for Social Security.

You can still use your HSA

Losing the ability to contribute doesn’t mean losing the money. The balance stays yours and tax-free for good. You can use it for Medicare premiums — Part B, Part D, and Medicare Advantage all qualify — along with deductibles, copays, and other qualified expenses. The one exception is Medigap premiums, which HSA funds can’t cover. After 65, you can also withdraw for non-medical reasons, paying ordinary income tax but no penalty.

2026 contribution limits

For 2026, you can contribute up to $4,400 for self-only coverage or $8,750 for family coverage, plus an extra $1,000 catch-up contribution once you’re 55 or older. If you’ll enroll in Medicare partway through the year, prorate your contributions for the months you were eligible, and remember to leave room for the six-month lookback.