Mid-Year Change from HSA to PPO

[PJ2009]

Good Morning,

The participant elected HSA, made a $4,000 contribution early in 2009, and then as of April 1 elected to enroll in the company's PPO. Looks like a problem to me. Any suggestions? Thanks.

[PJ2009]

Good Morning,

The participant elected HSA, made a $4,000 contribution early in 2009, and then as of April 1 elected to enroll in the company's PPO. Looks like a problem to me. Any suggestions? Thanks.

Here is my thinking, and I welcome any comments. The employee was covered by the HSA for 3 months and should have to pay 25% of the annual contribution that he made. He should be reimbursed the other 75% since as of April 1 he is now covered under the low deductible plan. I don't believe he should be forced to remain in the HSA for the entire year, even though he made the entire annual contribution. So far I have found nothing in the guidance and I have pored over hundreds of Q&As in various rulings! Thanks all.