A bronze plan usually comes with a trade-off people know well: a lower monthly premium in exchange for a higher deductible. For years, many bronze plan members had no special tax break to help cover that deductible.
That changed this year. Starting January 1, 2026, bronze and catastrophic plans available through a Marketplace are treated as compatible with a Health Savings Account.
If you have one of those plans, or are shopping for 2027 coverage, it is worth understanding what an HSA does, what it does not do, and who can open one.
What changed in 2026
A 2025 federal law, often called the One Big Beautiful Bill, expanded who can use HSAs. According to IRS guidance on the law:
The IRS issued guidance on these changes and invited comments, so details may continue to be clarified. Check IRS.gov for the latest before you rely on a specific rule.
What an HSA actually is
A Health Savings Account is a personal savings account for qualified medical expenses. You open it with a bank or HSA provider, put money in, and use it to pay costs such as deductibles, copays, coinsurance and many prescriptions.
What makes it unusual is how it is taxed. HSAs are often described as having three tax advantages:
Unlike some workplace accounts, an HSA generally belongs to you. Unused money rolls over from year to year, and you keep the account if you change jobs or plans.
Who can contribute
Having an HSA-compatible plan is the starting point, but the IRS has other conditions. In general, to contribute for a given month you must:
- Be covered by an HSA-compatible health plan
- Not have other health coverage that disqualifies you (some types of coverage are allowed, others are not)
- Not be enrolled in Medicare
- Not be claimed as a dependent on someone else’s tax return
The IRS sets a maximum amount you can contribute each year, with different limits for self-only and family coverage and an extra catch-up amount for people 55 and older. These limits change annually, so check IRS.gov for the current figures before you contribute.
How it can work: a hypothetical year
Here is a made-up example with a bronze plan. These numbers are for illustration only. Actual tax savings depend on your tax bracket, state and how much you contribute.
| Step | Hypothetical amount |
|---|---|
| Bronze plan deductible | $7,000 |
| Money put into the HSA during the year | $3,000 |
| Covered medical costs during the year | $1,800 |
| Paid from the HSA, tax-free | $1,800 |
| Left in the HSA, rolls over | $1,200 |
In this example, the person used pre-tax money to pay their share of care, and carried the remainder into next year, where it can keep building a cushion against the deductible.
Related: Your Health Plan Has a Number That Can Cap Your Bills. Most People Never Look for It
The catch: rules on how you spend it
The tax benefits depend on using the money for qualified medical expenses. If you take money out for something else before age 65, the IRS generally treats that withdrawal as taxable income and adds a 20% penalty. After 65, non-medical withdrawals are generally taxed as income but without that penalty.
HSA vs. FSA: a quick comparison
Health Savings Account (HSA)
- Requires HSA-compatible coverage
- Unused money generally rolls over
- Generally stays with you if you change jobs
- Can be opened on your own
Flexible Spending Account (FSA)
- Offered through an employer
- Unused money may be lost, with limited exceptions
- Usually tied to that employer
- Does not require a specific plan type
How to get started
- Confirm your plan qualifies. Check your plan documents or ask your insurer whether your plan is HSA-compatible for this year.
- Check your other coverage. Make sure you do not have other coverage that would make you ineligible.
- Choose an HSA provider. Compare fees, minimum balances and investment options among banks and HSA providers.
- Decide how much to contribute. Stay within the IRS limit for your situation, prorated if you were not eligible all year.
- Keep records. Save receipts and statements. HSA activity is reported on your tax return.
Two things people get wrong
Which situation looks like yours?
Related: Stop buying $35 ACA plans until you read this!
What HSA money can usually pay for
The IRS defines which expenses qualify, mainly in Publication 502. Common examples that generally qualify include:
- Deductibles, copays and coinsurance for covered care
- Many prescription medicines
- Dental care, such as cleanings, fillings and many other treatments
- Vision care, such as eye exams, glasses and contact lenses
- Many medical supplies and equipment
Health insurance premiums are generally not a qualified expense, with some exceptions the IRS lists, such as certain premiums while receiving unemployment benefits, COBRA continuation coverage, qualified long-term care insurance and, for people 65 and older, certain Medicare premiums. Check Publication 969 before paying a premium from an HSA.
You can pay yourself back later
One feature many people miss: you do not have to use HSA money at the moment you pay a bill. If you pay a qualified expense out of pocket, you can generally reimburse yourself from the HSA later, as long as the expense happened after the HSA was set up.
Some people use this to let the account build up over time, then reimburse themselves years later. The key is records. Keep the receipt or statement for every expense you plan to reimburse, because you may need to show the IRS that it qualified.
Bronze plus HSA vs. a silver plan
For many shoppers, the real decision is between a bronze plan with an HSA and a silver plan without one. There is no universal winner. It depends on your income, your expected care and whether you qualify for extra help.
Bronze with an HSA may suit you when
- You expect fairly low medical use
- You can afford to put money aside in the HSA
- You want to build tax-advantaged savings over time
Silver may suit you when
- You expect regular care or ongoing prescriptions
- Your income qualifies you for cost-sharing reductions, which are only available on silver plans
- A lower deductible matters more than tax savings
Cost-sharing reductions can lower deductibles and copays for eligible people with lower incomes, but only when they enroll in a silver plan through the Marketplace. If you might qualify, compare carefully before choosing bronze for the HSA alone.
Related: You’re Comparing Health Plans. You May Be Looking at the Wrong Number
Choosing an HSA provider
HSAs are offered by banks, credit unions and specialized companies. They are not all alike. Before opening one, compare:
Money invested in an HSA can lose value like any investment. If you expect to need the money soon for medical bills, keeping some of it in cash may make sense.
Frequently asked questions
Can I open an HSA with a Marketplace bronze plan?
Starting January 1, 2026, IRS guidance treats bronze and catastrophic plans available through an Exchange as HSA-compatible. You must also meet the other eligibility rules.
How much can I put in?
The IRS sets annual limits that differ for self-only and family coverage, with a catch-up amount for people 55 and older. Check IRS.gov for the current year’s figures.
What can I spend HSA money on?
Qualified medical expenses as defined by the IRS, such as deductibles, copays and many prescriptions. IRS Publication 502 describes what generally qualifies.
What happens to the money if I switch plans?
The account generally stays yours. You may not be able to add new money while you lack HSA-compatible coverage, but you can usually still spend what is there on qualified expenses.
Keep reading
Sources to review: IRS.gov guidance on HSA changes under the One Big Beautiful Bill (Notice 2026-05); IRS Publication 969 (HSAs) and Publication 502 (medical expenses); HealthCare.gov.
This article is educational information, not tax, legal, medical or financial advice. Examples are hypothetical. Tax rules and contribution limits change, so confirm current details with the IRS or a tax professional.