[cinives]

I didn't know there were any states that were able to prohibit HSAs, since it is a federal law and really only has tax consequences. There's certainly nothing (as far as I know) keeping you from a high deductible insurance plan; it's just that the deductible you pay would not be tax-exempt. I'm just curious - how is it possible for the state to block this ?

[Wiseghy]

"...states...able to prohibit HSA's since it is a federal law." States regulate insurance plans through their departments of insurance. Insurance products are almost all state regulated.

Some more activist departments attempt to decide which are "acceptable" health insurance products, in an attempt to "protect" the public. They often mandate that plans have to have $20 co-pays and low deductibles. These rules make plans expensive and, in effect, make it impossible to offer the High Deductible plans that are needed to have an HSA. Hawaii and R.I. and excellent examples of this travesty, but there are lots of others states that do this as well. Unfortunately, you MUST have a high deductible health plan in order to have an HSA. If your state makes it illegal to have a HDHP, you're out of luck.