HSA for children

[Guest lmccormick]

Can I have a high deductible insurance plan/HSA for a dependent child?

We currenly have a family catastrophic plan/HSA but want to drop the parents due to the fact hey are covered by the VA for their medical needs. Thus they would only need coverage for their dependent children.

Is this within the scope of the rules?

[Larry M]

I believe the act allows any individual under the age of 65 who has coverage only under a high deductible plan to establish an HSA.

The problem may be in getting the child insured by a carrier.

[KJohnson]

From the OPM cite:

http://www.opm.gov/hsa/faq.asp#eligibleHSA

Who is eligible for an HSA?

You must participate in a High Deductible Health Plan, have no other insurance coverage other than those specifically allowed, and not be claimed as a dependent on someone else’s tax return in order to be eligible for an HSA. Some examples of other coverage that would cause ineligibility are: a flexible spending account (FSA), a spouse’s FSA, a spouse’s HMO, other non-high deductible health insurance coverage, TRICARE, Medicare, or receipt of VA benefits within the previous three months. You can still have other disability, dental, vision and long-term care insurance policies

[Guest greatlakeshsa]

Exactly - From a tax standpoint, it would be better to max out or raise your family deductable to say $5150, then drop your kid as a dependent and setup a HSA for him/her. I understand why someone would want to do it, but i think it is better to leave jr as a dependent.