Can FSAs or HSAs pay for health insurance?
Can you use an FSA to pay for health insurance premiums if you have
no benefits through your work? If you are allowed, can you have
an HSA as well and just use your FSA to pay premiums?
A health flexible spending arrangement (FSA) allows employees to
be reimbursed for medical expenses on a pretax basis through a
plan sponsored by their employers. The plan is usually funded by
voluntarily deferring part of your salary into the FSA plan.
A health savings account (HSA) is a tax-exempt trust
or custodial account that you set up with a qualified HSA trustee
to pay or reimburse certain medical expenses you incur. You must
be eligible to qualify for an HSA. It is similar to an IRA, but
rather than providing for retirement, it can be used to cover medical
Generally, neither plan can pay health insurance premiums.
However, an HSA in certain limited circumstances can pay premiums.
In an HSA you can treat premiums for long-term care coverage, health-care
coverage while you receive unemployment benefits or health-care
continuation coverage required under federal law as qualified medical
If you are age 65 or older, you can treat insurance
premiums (other than premiums for a Medicare supplemental policy,
such as Medigap) as qualified medical expenses for HSAs. IRS Publication
969 has additional information on HSAs and FSAs and how to qualify