I have an HSA. I was in a car accident a few months ago. I'm wondering if it's ok to pay for my medical bills out of the HSA if I know they're going to be reimbursed by the other driver's insurance company. Do I have to pay tax + the penalty on the reimbursement? Can I put the reimbursement back into the HSA? Will that count against my annual contribution limit?

I can't find the answers online.

6/24/2009 9:36:29 PM

in all seriousness

call your HSA company and ask them

6/24/2009 10:21:10 PM

I think there is a rule that your health insurance can't pay for your medical bills and then you also get money for for the full cost of your medical bills. You can only get reimbursed for your contribution. If you get money for the portion paid by your health insurance then you're obligated to give the money back to your health insurance.

I don't know if you can put the money back into your HSA b/c it is usually taken before tax.

It might be best not to get your insurance involved until you're sure how it all works.

6/24/2009 10:32:09 PM

Quote :

"call your HSA company and ask them"

And get everything in writing thereafter.

6/25/2009 8:53:16 AM

I know how it works with health insurance. HSA pays the deductible & insurance does the rest.

This question is about CAR insurance.

6/25/2009 8:56:37 AM

IANAL but, i think yoru fine, as long as you dont go to court.

For example.


Without Court
If i hit your car, and you break your leg, you use your own health insurance, you show 20k in medical bills, my insurance company pays you the 20k (and your responsible for what your health insurance dosnt cover)

You pocket that, and in the future if your leg continues to act fucked up, you can still use your health insurance to fix it.

With Court
If i hit you with your car, break your leg, you use your health insurance, you show 20k, my company disputes, you win 30k in court.

You loose 1/3 to the lawyer, so you have your 20k, but then that goes to reimburse the insurance companies costs, which might leave you with nothing.

In addition, if your leg continues to act fucked up, you cant use your health insurance to cover the injury, you have to pay out of pocket.


But next they reimburse the insurance compnay

6/25/2009 9:22:56 AM

LimpyNuts, I am fairly sure this is a form of insurance fraud. You are getting reimbursed twice. Since these are insurance payments, they are not considered income (in this instance), and you would essentially be getting tax free income on the second imbursement.

I can almost guarantee you it isnt allowed, by law, in just about every case, and if they catch you, it probably wouldnt be good.

6/25/2009 9:50:47 AM

thus far i've only paid out of pocket. but if the bills get to be enough where i can't (my insurance has a $5000 deductible), then what am i supposed to do?

6/25/2009 9:58:43 AM

thus far i've only paid out of pocket. but if the bills get to be enough where i can't (my insurance has a $5000 deductible), then what am i supposed to do?

6/25/2009 9:59:11 AM

Can't you file a claim on your own car insurance to cover the costs? I always thought it was best to file a claim on your own car insurance and let the car insurance companies duke it out, but I'm not really sure.

6/25/2009 11:01:12 AM

I'm not sure I understand why it would be considered getting reimbursed twice. Regardless, keep receipts and document all payments by your insurance or out of your own pocket. Sometimes the HSA company will reimburse you if you don't use your HSA account checks or debit card, but are able to show proof of medical payments.

6/25/2009 11:44:51 AM

^Because he put the $5k into a HSA tax free which would in return be reimbursed, also tax free. He would have essentially laundered $5k out of his HSA that he can now use to buy a motorcycle or whatever.

[Edited on June 25, 2009 at 11:49 AM. Reason : assuming he doesn't report it to the irs and pay income tax + penalty]

6/25/2009 11:48:49 AM

Oh, I see now. Yeah, that's dishonest.

6/25/2009 12:52:19 PM

I do not understand why you can not increase your HSA money at any time and why it is "lost" at years end.
The money in my HSA account is "MY" money. As long as its used on medical expenses why does it matter if I increase my weekly deduction from my paycheck. Most costly medical expenses are usually not planned or known about by December 31st of the prior year.

6/25/2009 12:57:32 PM

Why don't you call an attorney and ask them? Plenty of places give free advice without having to sign up for anything.

6/25/2009 12:58:34 PM

Technically if i wanted to cheat the system i could max out my HSA contribution. Go to Target buy X number of the most expensive OTC drug they have, with cash or my Visa card of course. Copy my receipt, fill out the HSA form, go to post-office, and $profit$.

[Edited on June 25, 2009 at 1:13 PM. Reason : l]

6/25/2009 1:12:57 PM

Im confused. How is that fraud? Planning on returning them when you get reimbursed?

6/25/2009 1:24:41 PM

Do your companies require you to justify your HSA withdrawals?

Ours doesnt. We can take whatever we want out of the account, knowing that if we get audited by the IRS, and cant prove the withdrawals were for approved medical expenses, we are fucked.

6/25/2009 1:34:54 PM

I want to put the reimbursement BACK in the HSA.

I'm just going to call the IRS.

6/25/2009 1:55:52 PM

Quote :

"LimpyNuts, I am fairly sure this is a form of insurance fraud. You are getting reimbursed twice. Since these are insurance payments, they are not considered income (in this instance), and you would essentially be getting tax free income on the second imbursement. I can almost guarantee you it isnt allowed, by law, in just about every case, and if they catch you, it probably wouldnt be good."

that's what I was trying to say. you gotta pay back the money you were reimbursed if your insurance pays for medical fees and then you use your hsa to pay for your medical insurance copays.

6/27/2009 12:09:32 AM