For all you "city water folk," if this is a new problem, chances are you just installed a water softener - happens about 10% to 20% of the time. Same for you "well water folk" if you have the smell on the HOT side ONLY and didn't have it before. (Otherwise, time to have your well tested again or, just move.) Also, it could be that your warrantee expired a day or two ago and the Anode rod(s) are dissolving.
Hot water tanks have 1 ANODE rod for a 5 year warrantee and 2 rods for a 10 year warrantee - you do the math. The rods attract the "crud" away from the tank and keep it from rusting out just long enough to get through the warrantee period; after which you can expect a flood any day - get your pets to high ground. If you have a quality, properly functioning water softener you don't have "crud" (i.e. "hard water" deposits lead to rusty tanks like north country road salt on your Chevy!) You can have someone pull the
rod(s) out - don't forget to shut off the water to the tank and DEPRESSURIZE - and put a pipe plug in. Your tank should NOT rust anytime soon with a softener. (Just don't bypass that softener too many days a year.) Those rods aren't going to come out willingly so, be very, very, careful twisting on those gas appliances with a big wrench. Especially with those glass lined tanks! The trained gorillas at the tank factory wrench those babies in pretty good. You can destroy your tank if you aren't careful and even if you ARE! Sometimes, they just will not come out without damage (even with an impact wrench)! You may be looking at buying a new heater even if it IS a relatively new unit.
Note: It is easier to get the rods out before installation. If space is tight on one that is installed (which is almost always) you can pull the rod up a few inches, bend it, then repeat until it is out. If you scraped the rod a lot, flush the tank.
No guarantees. Go ask a professional before you start busting up your $200 tank!
Regarding "health concerns": your Government says those rods are safe so, it must be safe. Right? Get a Reverse Osmosis (RO) unit and drink H2O molecules! Use it for cooking. Makes great tasting coffee and keeps that coffee maker nicer on the inside longer, too! Just be sure to maintain it properly and change the filters as recommended!