Health Saving Accounts and ObamaCare for 2023
We cover everything you need to know about Health Savings Accounts (HSAs) for 2023, including how HSAs work with health plans under the Affordable Care Act.
TIP: The Affordable Care Act is sometimes called “ObamaCare” or the “ACA” for short. Thus, this page is about HSAs and how they work with ObamaCare / ACA plans. Learn more about the Affordable Care Act.
HSA Chart for 2023
|2023||Minimum Deductible||Maximum Out-of-Pocket||Contribution Limit||55+ Contribution|
HSA Limits 2022 Summary
Below are the limits for contributions, deductibles, and out-of-pocket maximums for HSAs.
Minimum Deductible for HSA Eligibility 2023
- $1,500 for self-only coverage ($100 increase from 2022)
- $3,000 for family coverage ($200 increase from 2022)
NOTE: $3,000 for embedded individual deductible ($100 increase from 2022)
NOTE: The minimum deductible, which is the minimum deductible your High Deductible Health Plan must have after cost assistance.
Maximum Out-of-Pocket Limit for HSA Eligibility 2023
- $7,500 for self-only coverage ($450 increase from 2022)
- $15,000 for family coverage ($900 increase from 2022)
NOTE: The maximum out-of-pocket is the highest maximum a plan can have to qualify for an HSA.
TIP: The maximums are slightly lower on HSA compatible plans than they are in general on health plans. This has to do with the fact that the rates are raised by different mechanisms. The difference allows for non-HSA compatible high deductible plans. Thus, if you want an HSA, make sure your plan is “HSA Eligible.”
HSA Contribution Limit for 2023
- $3,850 for self-only coverage ($200 increase from 2022)
- $7,750 for family coverage ($450 increase from 2022)
NOTE: 55 plus can contribute an extra $1,000.
TIP: See Rev. Proc. 2022-24 for final HSA levels.
What Are Health Savings Accounts?
Health savings accounts are tax-advantaged medical savings accounts that you can draw money from for certain medical expenses. They work a bit like a 401k, but money is tax-free in and tax-free out. They are very useful in this respect as they can drop your MAGI (household income after deductions), help you pay fewer taxes, and help you qualify for more assistance.
However, they have some caveats too. Specifically, you can’t pay your premiums with an HSA, and like with a 401k or IRA, you can lose money if you take risky bets so be cautious if you are going to invest your HSA funds.
One last note, to fund an HSA you need to have a High Deductible Health Plan (HDHP) that counts as Minimum Essential Coverage (MEC). So any marketplace plan with a high deductible after cost-sharing assistance or any private major medical plan. Employer plans typically need to be paired with employer offered accounts. Medicare, Medicaid, CHIP, aren’t HSA eligible.
FACT: HSA’s aren’t “use it or lose it.” The money that you put in an HSA goes in tax-free. You can keep it, invest it, use it tax-free on medical expenses, withdraw funds from it at a fee, and roll it over into a retirement account when you are ready for Medicare. Only FSA’s, the kind of health savings account you get through your employer, is “use it or lose it.”