HSAs, HRAs, and FSAs, Explained

THE ACCOUNTSHSA, HRA, and the three FSAs, side by side

Sources: IRS Publication 969, OPM's plan types page, and FSAFEDS on the Health Care FSA, Limited Expense FSA, and Dependent Care FSA.

HSA: WHO CAN HAVE ONEThe IRS rules, in plain words

You can put money into an HSA for any month you meet all of these, per IRS Publication 969 and OPM:

• You're in a high-deductible health plan (HDHP) on the first day of the month. For 2027 that means a deductible of at least $1,750 for self-only or $3,500 for family coverage.
• You have no other health coverage, unless it's also an HDHP. A spouse's plan counts only if it covers you. Dental, vision, accident, disability, and long-term care coverage are allowed, and so is telehealth.
• You aren't enrolled in Medicare. Your HSA limit drops to zero starting the first month you're enrolled, and that includes Medicare that gets backdated.
• Nobody can claim you as a dependent on their tax return.
• You don't have a general-purpose Health Care FSA, yours or a spouse's that covers you. A Limited Expense FSA, for dental and vision only, is fine.

If you're in an FEHB high-deductible plan and can't have an HSA, the plan doesn't leave you with nothing: OPM says FEHB HDHPs give a comparable HRA to anyone who isn't eligible for an HSA, and you tell the plan so it can set one up.

HSA LIMITS2026 and 2027, from the IRS

Sources: Revenue Procedure 2025-19 (2026) and Revenue Procedure 2026-24 (2027); the $1,000 catch-up is in Publication 969.

• The plan's deposit counts toward your limit. FEHB plans call it a premium pass through. Subtract it before you set your own contribution: GEHA's HDHP, for example, puts in $1,000 for Self Only in 2027, which leaves $3,500 for you under the $4,500 limit (RI 71-014, page 36).
• Part of a year? The limit is generally figured by the months you qualify, unless you're eligible on December 1, when the IRS last-month rule lets you count the whole year if you stay eligible through the next year.
• Spending it. Money used for qualified medical expenses comes out tax-free. Money used for anything else is taxed, plus a 20% additional tax unless you're 65 or older, disabled, or the withdrawal follows a death (IRS Publication 969).

FEHB PLANS WITH AN ACCOUNTEvery 2027 option that puts money in an HSA or HRA

FEHB has two kinds of plans that come with an account. A high-deductible plan (HDHP) opens and partly funds an HSA if you're eligible, or an HRA if you're not. A consumer-driven plan (CDHP) funds an HRA. The plan's yearly deposit is below, from OPM's 2027 plan files; three of them did not match the plan's own brochure, so the brochure's figure is shown and noted.

16 plan options for 2027: 9 high-deductible, 7 consumer-driven. Deposits are per year for Self Only, Self Plus One, and Self and Family; HDHPs pass the HSA money through monthly, and a partial year is prorated. Codes are the enrollment codes for each type, in the same order.

To line these up against every other plan where you live, use the FEHB plan comparison and set Account to “plans that fund an HSA” or “plans that fund an HRA.” Its year cost counts the plan's deposit.

FSAFEDSThe three FSAs for federal employees

FSAFEDS runs the flexible spending accounts for federal employees, and since 2025 for many service members. You set aside money from each paycheck before tax.

• The 2027 health FSA limit is set by the IRS each fall. FSAFEDS still showed $3,400 when we checked on October 29, 2026, and had not posted a 2027 figure; check the FSAFEDS limits page before you elect.
• Carryover. Up to $680 left in a Health Care or Limited Expense FSA carries into 2027 when you re-enroll, and it does not count against the next year's limit. The Dependent Care FSA has a grace period instead: the 2027 balance can be spent through March 15, 2028.
• You enroll every year, during Open Season (November 9 to December 14, 2026), directly with FSAFEDS, not through your agency. Nothing carries over automatically, and outside Open Season you can enroll or change only after a qualifying life event (FSAFEDS Open Season).
• Two federal spouses can each elect up to $3,400 for a Health Care FSA; the Dependent Care FSA limit is $7,500 for the household (FSAFEDS).
• Retirees and annuitants can't enroll, except an annuitant who is re-employed and eligible through the current job (FSAFEDS).
• HSA holders take the Limited Expense FSA, not the general one: under IRS rules you can't contribute to an HSA while enrolled in a general-purpose Health Care FSA (FSAFEDS).

FOR THE MILITARY COMMUNITYTRICARE, VA care, service members, and retirees

• Service members can use FSAFEDS. Since 2025, members of the regular (active) component, Guard and Reserve members on Active Guard Reserve (AGR) duty, and Coast Guard Reserve members on active duty for more than 180 days can enroll in the Health Care FSA and the Dependent Care FSA. Other reserve members can't (FSAFEDS). Sign up during Federal Benefits Open Season, or after a qualifying life event such as a PCS or separation (FSAFEDS).
• A Health Care FSA pays TRICARE costs like copays, cost shares, and deductibles, plus dental and vision costs. DoD's Office of Financial Readiness keeps a guide to what it covers with each TRICARE plan (FINRED).
• Military retirees can't use FSAFEDS as retirees. A military retiree working as a federal civilian enrolls as an employee, like anyone else in the job.
• Veterans using VA care: VA care for a service-connected disability doesn't stop an HSA; other VA care in the last three months does, under the FEHB brochures' rule (see who can have one).

DENTAL AND VISIONWhere FEDVIP and the FSAs meet

A FEDVIP dental or vision plan pays part of the bill. What's left, the deductibles, coinsurance, and anything past the plan's allowance, is the kind of expense a Health Care FSA pays, or a Limited Expense FSA if you have an HSA. FSAFEDS lists exams, cleanings, X-rays, braces, contact lenses, eyeglasses, and laser eye surgery. To see what each FEDVIP plan leaves you to pay, use the FEDVIP dental and vision comparison.

NEW SINCE 2025What Public Law 119-21 changed for HSAs

The tax law signed July 4, 2025 (Public Law 119-21) changed three things, explained by the IRS in IR-2025-119 and Notice 2026-05:

• Telehealth before the deductible no longer stops an HSA, permanently, for plan years starting on or after January 1, 2025.
• Bronze and catastrophic plans count as HSA-compatible starting January 1, 2026, whether or not they're bought through an exchange. That matters if you're leaving service or federal work and buying your own coverage.
• Direct primary care. Starting in 2026, certain direct primary care arrangements don't stop an HSA, and HSA money can pay the monthly fee, up to $150 a month, or $300 if the arrangement covers more than one person (the same for 2027 under Revenue Procedure 2026-24).

WHO TO ASKThe doors

FSAFEDS answers FSA questions at 877-FSAFEDS (372-3337), TTY 866-353-8058, weekdays 9 a.m. to 9 p.m. Eastern; your agency does not handle FSAFEDS. Your health plan names its HSA trustee and HRA administrator in its brochure, and runs both. Your agency's benefits office handles FEHB enrollment, and OPM Retirement Services does for retirees. Service members can ask a personal financial manager or counselor on the installation. For your own tax return, a tax professional or the IRS's Publication 969 is the source.