Can an HSA be used to pay IRMMA costs?

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kardan
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Joined: Sun Apr 28, 2019 9:56 am

Can an HSA be used to pay IRMMA costs?

Post by kardan » Thu Feb 13, 2020 12:10 pm

My understanding is that IRMMA is not a tax. It is an additional contribution to Medicare premiums charged based on level of income. Since an HSA can be used to pay Medicare premiums, does that include the portion that is IRMMA related? I have done a search and have been unable to find this point addressed anywhere.

cas
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Re: Can an HSA be used to pay IRMMA costs?

Post by cas » Thu Feb 13, 2020 12:44 pm

Yes.

IRMAA is actually a reduction in the subsidy people get on their Medicare Part B and Part D premiums. So, even if your Medicare B/D premium is higher than the base level of Medicare B/D premium due to you being in a higher IRMAA bracket, it is still purely a Medicare premium ... just a less subsidized one.

(For normal after-age-65 Medicare situations, everyone on Medicare B and D gets at least a 15% subsidy off the true cost of their Medicare Part B and D premium. Most people get a 75% subsidy. IRMAA reduces the subsidy to, for various IRMAA brackets, 65%, 50%, 35%, 20%, 15%.

For more information, see:

Easier reading:
Kaiser Family Foundation, "Medicare’s Income-Related Premiums Under Current Law and Changes for 2019", Oct 2019

Harder reading, but the primary source:
42 U.S. Code § 1395r(i)"Reduction in premium subsidy based on income" , https://www.law.cornell.edu/uscode/text/42/1395r
)

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FIREchief
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Re: Can an HSA be used to pay IRMMA costs?

Post by FIREchief » Thu Feb 13, 2020 1:03 pm

That's a good question. I would assume the answer is yes, but I'm sure somebody will weigh in with something conclusive.

btw: It's IRMAA, not IRMMA.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

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jjustice
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Re: Can an HSA be used to pay IRMMA costs?

Post by jjustice » Thu Feb 13, 2020 1:23 pm

Yes, you can no longer contribute to your HSA, but you can use any remaining funds to pay all medical expenses including Medicare premiums, IRMAA, and supplement premiums.

John

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jjustice
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Re: Can an HSA be used to pay IRMMA costs?

Post by jjustice » Thu Feb 13, 2020 1:24 pm

Duplicate deleted.

cas
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Re: Can an HSA be used to pay IRMMA costs?

Post by cas » Thu Feb 13, 2020 1:42 pm

jjustice wrote:
Thu Feb 13, 2020 1:23 pm
Yes, you can no longer contribute to your HSA, but you can use any remaining funds to pay all medical expenses including Medicare premiums, IRMAA, *and supplement premiums*.
(Emphasis added by me.)

Unfortunately, IRS Publication 969 (Health Savings Accounts and Other Tax-Favored Health Plans) specifies that Medicare supplement premiums are not eligible to be reimbursed from an HSA.
Insurance premiums.

You can’t treat insurance premiums as qualified medical expenses unless the premiums are for:
  • Long-term care insurance.
  • Health care continuation coverage (such as coverage under COBRA).
    • Medicare and other health care coverage if you were 65 or older (other than premiums for a Medicare supplemental policy, such as Medigap).

    Pam01
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    Re: Can an HSA be used to pay IRMMA costs?

    Post by Pam01 » Thu Feb 13, 2020 5:53 pm

    Insurance premiums.

    You can’t treat insurance premiums as qualified medical expenses *unless the premiums are for*:
    • Long-term care insurance.
    • Health care continuation coverage (such as coverage under COBRA).
      • Medicare and other health care coverage if you were 65 or older (other than premiums for a Medicare supplemental policy, such as Medigap).
      The text you have cut and paste does indicate Medicare supplemental policies are eligible.

      Spirit Rider
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      Re: Can an HSA be used to pay IRMMA costs?

      Post by Spirit Rider » Thu Feb 13, 2020 6:13 pm

      Pam01 wrote:
      Thu Feb 13, 2020 5:53 pm
      Insurance premiums.

      You can’t treat insurance premiums as qualified medical expenses *unless the premiums are for*:
      • Long-term care insurance.
      • Health care continuation coverage (such as coverage under COBRA).
        • Medicare and other health care coverage if you were 65 or older (other than premiums for a Medicare supplemental policy, such as Medigap).
        The text you have cut and paste does indicate Medicare supplemental policies are eligible.
        Read it again.

        Pam01
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        Re: Can an HSA be used to pay IRMMA costs?

        Post by Pam01 » Thu Feb 13, 2020 6:15 pm

        Ah, double negative. No wonder I use tax software for my taxes.

        jebmke
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        Re: Can an HSA be used to pay IRMMA costs?

        Post by jebmke » Thu Feb 13, 2020 6:23 pm

        Pam01 wrote:
        Thu Feb 13, 2020 6:15 pm
        Ah, double negative. No wonder I use tax software for my taxes.
        Software won't help in this case. Qualified medical expenses for HSA reimbursement are self-reported in one number.
        When you discover that you are riding a dead horse, the best strategy is to dismount.

        Pam01
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        Re: Can an HSA be used to pay IRMMA costs?

        Post by Pam01 » Thu Feb 13, 2020 6:26 pm

        jebmke wrote:
        Thu Feb 13, 2020 6:23 pm
        Pam01 wrote:
        Thu Feb 13, 2020 6:15 pm
        Ah, double negative. No wonder I use tax software for my taxes.
        Software won't help in this case. Qualified medical expenses for HSA reimbursement are self-reported in one number.
        I was commenting on the complexity of tax code and tax publications. Not specifically on HSA.

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