Open Enrollment Is a Tax Planning Window. Most Surgeons Use It as a Coverage Decision.

Open enrollment is treated as a benefits administration event in most surgical practices. You receive a packet, confirm your dependents are still on the plan, and move on.

That’s a missed tax planning window. For example, for an orthopedic surgeon earning $1 million in income, the benefit elections you make in November for the following January are a tax-related decision worth reviewing with the same attention you’d give a retirement plan amendment.

The HSA: A Triple Tax–Advantaged Account Across Working Years and Retirement

A health savings account (HSA) is one of the primary “triple tax–advantaged” vehicles in the code: contributions are deductible, growth is tax-deferred, and distributions for qualified medical expenses are tax-free.

For 2026, the family HSA contribution limit is $8,750. At age 55 or older, an additional $1,000 catch-up contribution is available per eligible individual, contributed to that person’s own HSA. For a surgeon at 57 covered under a family HDHP and making both the regular and catch‑up contribution, the combined limit is $9,750.

For someone in the 37% marginal federal tax bracket, fully funding the HSA at $9,750 would typically reduce federal income tax by approximately $3,608 for that year, assuming all else equal. Over a hypothetical 10‑year pre‑retirement window, with annual HSA contributions at current limits and a 7% annual return (not guaranteed), the difference between maxing and not maxing the HSA could approach roughly $135,000 in tax‑free assets earmarked for future medical costs.

The catch: HSA eligibility requires enrollment in a High Deductible Health Plan (HDHP) and the absence of other disqualifying coverage. For 2026, the IRS HDHP minimum deductible is $1,700 for self-only coverage and $3,400 for family coverage. If your current plan doesn’t meet that threshold, or if you have other non‑HDHP coverage, you are ineligible to contribute to an HSA regardless of whether you have the account open.

Open enrollment is when this gets resolved. If your current plan is not HDHP-qualified, the window to switch is typically in the fall (often October or November) for a January 1 effective date, subject to your employer’s specific enrollment schedule.

The HDHP–HSA Analysis for Surgeons

The standard objection to an HDHP is out-of-pocket exposure. Orthopedic surgeons, who often have access to workplace medical resources and whose spouses or families may have specific ongoing healthcare needs, are right to evaluate this carefully.

The analysis worth running in August is to compare the premium savings and HSA contribution benefits of the HDHP against the expected out-of-pocket cost differential from your current plan, based on your actual utilization and plan details. For many high-income households with relatively low utilization, the HDHP–HSA combination can be financially favorable on a net basis, but the outcome depends on premiums, utilization, and individual circumstances; a detailed, personalized analysis is required.

One scenario where it often doesn’t work: enrollment in disqualifying coverage. If a spouse’s non-HDHP employer plan covers the surgeon or the family, the surgeon is generally ineligible for HSA contributions. Enrollment in Medicare also generally disqualifies you from contributing to an HSA going forward. These are two frequent sources of unintended HSA ineligibility that should be identified before open enrollment.

FSA Coordination

If your plan includes a healthcare Flexible Spending Account (FSA), the IRS 2026 healthcare FSA contribution limit is currently $3,300. FSA dollars reduce taxable income in the year of contribution — the same general mechanism as the HSA — with important differences.

Healthcare FSAs are generally “use-it-or-lose-it” within the plan year, subject to plan-specific carryover or grace period rules. They cannot be invested or compounded. And a general-purpose healthcare FSA cannot be paired with an HSA on a standard basis — a general-purpose FSA and an HSA cannot coexist if you want to preserve HSA eligibility, unless the FSA is structured as a limited-purpose FSA (typically dental and vision only) or, in some cases, a post-deductible FSA under specific plan designs.

For a surgeon optimizing for the HSA, the typical election decision is: decline the standard general‑purpose healthcare FSA, elect the HDHP, and maximize the HSA. A limited-purpose FSA can then layer on top for dental and vision expenses without disqualifying HSA eligibility, if the employer offers that option.

The Dependent Care FSA

A separate vehicle often overlooked in surgical households with younger children or eldercare responsibilities is the dependent care FSA, which allows pre-tax contributions for qualifying care expenses. Beginning in 2026, current IRS guidance reflects an increased annual dependent care FSA limit of $7,500 for most households (with a $3,750 limit for married filing separately). This is separate from the healthcare FSA and does not affect HSA eligibility.

If your household has qualifying dependent care expenses — childcare, after-school programs, or adult day care for an aging parent — this election should be considered at open enrollment. For someone in the 37% federal tax bracket, contributing the full $7,500 would typically reduce federal income tax by approximately $2,775, assuming all else equal and that the contribution is fully deductible.

The August Diagnostic

Before your employer’s open enrollment period (often in October or November), three questions are worth answering now.

Is your current health plan HDHP-qualified? If you don’t know whether your deductible meets the IRS HDHP threshold, the answer is probably no — and this should be confirmed with your plan documents or benefits administrator before the enrollment window.

Are you maxing your HSA? If your plan is HDHP-qualified and you’re not contributing up to $9,750 as a 55+ surgeon with family coverage in 2026, that’s often the first incremental dollar of tax-advantaged savings to consider before any other benefits-related planning conversation.

Is there a dependent care FSA available in your benefits package that you haven’t elected? If the expense qualifies and the benefit is available, the potential tax savings from a properly funded dependent care FSA can be meaningful, particularly for high-income households.

Open enrollment produces its best outcomes when the decisions are made deliberately in August, not reactively in November.

Capably Yours,

Jared

DISCLAIMER

This article is for informational and educational purposes only and does not constitute investment, tax, or legal advice. It does not take into account the specific objectives, financial situation, or needs of any particular person. You should consult your own tax, legal, and investment professionals before acting on any information contained herein. Capable Wealth, a New York registered investment adviser, provides advisory services only where properly licensed or exempt from licensing.