HSA Deposits With Medicare: Why Your Employees May Need to Stop Their Contributions TopicsPopular TopicsMost Recent Medicare Working Past 65 Lifestyle & Wellness Considering Retirement Existing Clients Employer Monthly Webinars Community Development Do you have any employees who are eligible for Medicare and planning to enroll in the near future? If your organization offers a health savings account (HSA), you and your employees need to keep a couple of considerations in mind as they plan to transition to Medicare. HSA deposits with Medicare can be tricky, but our advisors offer simple, local help with Medicare questions. Why Your Employees May Need to Stop Their HSA Deposits If They’re Enrolling in Medicare After Age 65 If your employees are enrolling in Medicare after age 65, they have likely deferred part or all of their Medicare coverage. In the case of those past their Initial Enrollment Period, HSA deposits must be stopped six months in advance of applying for Medicare coverage. If your employees over age 64 are planning to sign up for Medicare soon, make a plan on when to stop their HSA deposits. Here’s why: Once Medicare Part A kicks in, it provides up to six months of “retroactive” coverage. But Medicare coverage can’t overlap with HSA contributions. Otherwise, it could subject your employees to penalties or complications during tax season. Your employees want to keep their hard-earned HSA dollars. By stopping contributions six months in advance of their Medicare application, you can help them do that! If They’re Applying for Medicare When They Turn 65 Different rules apply to individuals who apply for Medicare when they are first eligible. If an individual applies during their Initial Enrollment Period, they only need to stop their HSA contributions one month in advance. Explaining the Initial Enrollment Period The Initial Enrollment Period lasts seven months. It starts three months before an individual turns 65, includes their birth month, and goes another three months after their birthday. For example, an individual born on March 10 would have an IEP from Dec. 1 until June 30. Employee FAQs About HSA Deposits With Medicare Can I continue my HSA deposits after I enroll in Medicare? No. Doing so could subject you to fees or complications when you file your income taxes. When should I stop my HSA deposits? If you’re applying for Medicare during your Initial Enrollment Period (at or around your 65th birthday), stop your contributions one month before you enroll. But if you’ve deferred Medicare and are applying later, you need to stop your HSA deposits six months before you apply for Medicare coverage. Will I lose my HSA funds when I enroll in Medicare? No! Your account and its funds are still usable once you’re on Medicare. You can use your HSA to pay for covered medical costs on your new Medicare plan. Local Help With Medicare Questions for You & Your Employees Whether you’re an employer or an individual, we’re here for you when it comes to health coverage. If you have questions about this post, reach out to our advisors by calling 1-844-388-6565 or scheduling a call. We’re happy to offer local help with Medicare questions to our community members like you in Ohio, Kentucky, and Indiana. Stay informed about Medicare An easy way to stay updated on Medicare and any important changes is to sign up for the free, customizable RetireMEDiQ newsletter. Based on your personal preferences and interests, helpful articles and community-related content will be sent directly to your inbox. Sign up for our newsletter Yes! Tell me more about Medicare and help me explore my options.Name First Last Email* Birthdate MM slash DD slash YYYY Phone TypeMobileHomeWorkOtherMobile Phone*Home Phone*Work Phone*Other Phone*SMS Opt-In? Check here to receive text notifications from RetireMEDiQ Hiddenvidhidden HiddenAuthorization to Contact? CommentsThis field is for validation purposes and should be left unchanged. Providing your information in this form will allow RetireMEDiQ to communicate with you to help guide you through your Medicare journey and authorize RetireMEDiQ to send you appointment updates, alerts, and reminders via SMS/text messaging. Message and data rates may apply to any text messages sent by RetireMEDiQ.