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News Items, by Subject

Health savings accounts (HSAs)

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Larger HSA Balances Result in Increased Use of Health Care Services and Spending (PDF)
"The average HSA balance more than doubled between 2014 and 2016 among enrollees with employee-only coverage.... Individuals with $3,000 or more in their HSA at the beginning of the year made an additional 50 visits to primary care physicians and specialists per 100 plan enrollees. Their spending was about $20 higher for primary care office visits and $28 higher for specialist visits. Spending associated with outpatient services was $551 higher." (Employee Benefit Research Institute [EBRI])
Registered Investment Advisors Are Missing the Mark on HSAs (PDF)
"Almost 60% [of advisor surveyed] are still not offering HSAs, despite the benefits HSAs provide for both advisors and their clients 36% of advisors say they do not fully understand how an HSA works. And 40% claim that clients don't fully understand HSAs either. Nearly half say that HSAs are perceived only as spending accounts" (HSA Coach)
Plan Sponsors Say Educating Employees About HSAs Is Top Concern
"A quarter of organizations encourage or offer additional education to employees who do not contribute to the HSA or only contribute a nominal amount. The average participant contribution in 2018 was $2,595 and the average account balance at the end of 2018 was $5,239. The vast majority of responding organizations (85.6%) offer investment options for HSA contributions, though three-quarters require a minimum balance of at least $1,000 to invest assets beyond money market funds or cash." (Plan Sponsor Council of America [PSCA])
HSAs Get AI Upgrades
"New users are asked questions about their health histories, income and risk tolerance. Machine learning is used to compare their answers against a large insurance-claims data set, analyze the information and then offer guidance. The tool analyzes claims and location data, for instance, to see if people are getting the most cost-effective care." (The Wall Street Journal; subscription may be required)
2020 HSA and HDHP Limits Announced
"Given the increasing costs of health insurance, employers may find adding an HDHP option (with these new limits) to their welfare plan financially favorable.... Plan sponsors should ensure that all participant communication for the 2020 plan year reflects the new limits.... Payroll and HSA vendors must make sure their systems are updated for 2020 to allow for the increased contributions per the larger limits." (Findley)
[Official Guidance] Text of IRS Rev. Proc. 2019-25: 2020 Inflation-Adjusted Amounts for Health Savings Accounts (HSAs)
"For calendar year 2020, the annual limitation on deductions under Section 223(b)(2)(A) for an individual with self-only coverage under a high deductible health plan is $3,550 ... [and] for an individual with family coverage under a high deductible health plan is $7,100.... For calendar year 2020, a 'high deductible health plan' is defined under Section 223(c)(2)(A) as a health plan with an annual deductible that is not less than $1,400 for self-only coverage or $2,800 for family coverage, and the annual out-of-pocket expenses ... do not exceed $6,900 for self-only coverage or $13,800 for family coverage." (Internal Revenue Service [IRS])
Do Accumulating HSA Balances Affect Use of Health Care Services and Spending?
"[This study finds] that as individuals build up balances in HSAs, they use more health care services than they otherwise would. In essence, HSA balances may blunt the cost-reducing effect of high-deductible health plans over time.... [E]mployers may want to consider the impact of the size of the plan's deductible. Another approach is to explore education around the long-term benefits of saving the HSA balance for health care expenses in retirement." (Employee Benefit Research Institute [EBRI])
Can Your Company Auto-Enroll Its Employees Into an HSA?
"Auto enrolling your employees in an HSA plan is not as straightforward as a 401(k), due to the healthcare eligibility requirements.... Some HSA providers benefit from state law that provides that an HSA is automatically established on the first day of coverage under an HSA-qualified healthcare plan as long as the HSA is opened before the federal income tax filing deadline for that year. If you're considering this option, find an HSA provider that benefits from this provision." (HealthEquity)
Employer Contributions to HSAs Jump in 2018
"Health savings accounts received record-breaking contributions in 2018 with accountholders and employers pouring $33.7 billion into HSAs, up 22% from 2017. Employer contributions grew to their highest level, totaling over $8 billion in 2018." (Devenir)
IRS Information Letter Addresses Code Section 213 Medical Care Requirements
"According to [IRS Information Letter 2019-005], factors to consider when determining whether a personal expense was incurred for medical care include: [1] the motive or purpose for the expense, [2] whether a physician has diagnosed a medical condition and recommended the item as treatment or mitigation, [3] the relationship between the treatment and the illness, [4] the treatment's effectiveness, and [5] the proximity in time to the onset or recurrence of a disease. A personal expense generally will be considered an expense for medical care only if the taxpayer would not have incurred the expense but for the taxpayer's disease or illness." (Thomson Reuters / EBIA)
Using Pretax Health Savings to Keep More Money in Your Pocket
"If you have high medical costs, or think you may need high-cost care like surgery or you're planning to have baby -- it pays to put cash aside for those out-of-pocket costs pre-tax. There are two kinds of tax-advantaged savings accounts that let you put money away for health care needs, depending on what kind of health plan you have." (CNBC)
Bills Now in House and Senate to Allow Reimbursement for OTC Drug Expenses
"H.R. 1922, the Restoring Access to Medication Act ... would overturn the provision in the [ACA] that prohibited FSAs, HRAs, and HSAs from reimbursing expenses for over-the-counter drugs unless the drug is insulin or prescribed by a physician.... S. 1089, the Restoring Access to Medication Act ... would also overturn the ACA provision that prohibited FSAs, HRAs, and HSAs from reimbursing expenses for over-the-counter drugs." (Employers Council on Flexible Compensation [ECFC])
How Many Are Enrolled in HSA-Eligible Health Plans, and How Is It Changing? (PDF)
"Growth in HSA-eligible health plans continues, but at a slower rate than in the past. Several factors -- such as the delay in the Cadillac tax, low insurance premium increases, and low unemployment -- may be holding back growth in HSA-eligible health plan enrollments." (Employee Benefit Research Institute [EBRI])
Enrollment in HSA-Eligible Health Plans: Slow But Steady Growth Continues
"By 2018, HSA-eligible health plan deductibles were only twice as large as PPO deductibles. If the gap continues to fall, enrollment in HSA-eligible health plans may begin to accelerate. Several factors -- such as the delay in the Cadillac tax, low insurance premium increases, and low unemployment -- may be holding back growth in HSA-eligible health plan enrollments.... All of the surveys find substantial growth in HSA-eligible health plan enrollment since HSAs were established in 2004." (Employee Benefit Research Institute [EBRI])
2018 Year-End Devenir HSA Research Report (PDF)
10 pages. "The number of HSA accounts surpassed 25 million, holding $53.8 billion in assets, a year-over-year increase of 13% for accounts and 19% for HSA assets for the period ended December 31st, 2018.... HSA investment assets reached an estimated $10.2 billion at the end of December, up 23% year-over-year. On average, investment account holders hold a $14,617 total balance[.]" (Devenir)
Feasibility of HSAs for Retirement Savings
"Health savings accounts (HSAs) are now being touted as a way for saving for health care expenses in retirement, but is this feasible? A recent report found employees spend 90% of their HSA assets on current medical expenses, leaving little to save/invest for the long term." (PLANSPONSOR; free registration may be required)
IRS Information Letter Addresses Return of HSA Contributions to an Employer
"If there is clear evidence of an administrative or process error, an employer may request that the contributions it made to an employee's HSA be returned. This correction should put the employer and employee in the same position that they would have been in if the error had not occurred." (United Benefit Advisors)
[Official Guidance] Text of 2018 IRS Publication 969: Health Savings Accounts and Other Tax-Favored Health Plans (PDF)
22 pages, Mar. 4, 2019. "Salary reduction contributions to your health FSA for 2018 are limited to $2,650 a year." (Internal Revenue Service [IRS])
IRS Provides Examples for Employer to Recover Mistaken HSA Contributions (PDF)
"[IRS Information Letter] 2018-0033 further confirms that where there is clear documentary evidence showing there was an administrative or process error, the employer may request the return of the contributed amounts -- with any correction placing the parties in the same position as if the error had never occurred." (EPIC)
When May an Employer Recover Mistaken HSA Contributions?
"Generally, if there is clear documentary evidence that an administrative or process error (by the employee or trustee) caused the excessive fund contribution, the employer may request the financial institution return the amounts to the employer, ensuring such correction places the parties in the same position as they would have been if the error had not occurred." (Compliance Dashboard)
[Guidance Overview] IRS Provides Additional Examples Where Employers May Recover HSA Contributions
"[Information Letter 2018-0033] confirms that where there is clear documentary evidence demonstrating that there was an administrative or process error, the employer may request the return of the contributed amounts, with any correction placing the parties in the same position as if the error had never occurred." (The Wagner Law Group)
Recovering Mistaken HSA Contributions
"An IRS pronouncement released 10 years ago (Notice 2008-59) provides two instances in which the employer can recover a mistaken contribution ... A recently released Treasury Department Information Letter 2018-0033 expands the instances in which an employer can re-coup excess HSA contributions[.]" (CBIZ)
How to Get Your Employees Excited About HSAs
"Engaged employees are more likely to use their health plan wisely ... ultimately driving overall healthcare costs down.... The fear of missing out on compounded investment dollars in an HSA can be a compelling case for getting started now.... Keeping HSAs top of mind with continual engagement throughout the year will reinforce with your employees that their health and wealth is a priority for you.... [M]ake it easy for them to enroll and contribute to their HSAs." (HealthEquity)
[Official Guidance] Text of Treasury Department General Information Letter 2018-0033: Correcting Mistaken Contributions to HSAs (PDF)
"Outside of the specific situations described in Notice 2008-59, examples of the type of errors which may be corrected ... include.... [1] An amount withheld and deposited in an employee's HSA for a pay period that is greater than the amount shown on the employee's HSA salary reduction election.... [2] An amount that an employee receives as an HSA contribution because it is incorrectly entered by a payroll administrator ... [3] An amount that an employee receives as an HSA contribution because a change in employee payroll elections is not processed timely ... [4] An amount that an employee receives because an HSA contribution amount is calculated incorrectly." (Internal Revenue Service [IRS])
How to Position Consumer Directed Healthcare and HSAs with Your Employees
"By partnering with your employees and instilling the benefits of the HSA and coupling with an ownership mentality, you're helping set them up for success. Employers that make the move to a CDHP with an HSA, are in a great position to not only save on their healthcare offering to employees, but to help make real gains to improve their employees' healthcare picture." (HealthEquity)
[Official Guidance] Text of 2018 Instructions for IRS Form 8889: Health Savings Accounts (HSAs) (PDF)
"Use Form 8889 to: [1] Report health savings account (HSA) contributions (including those made on your behalf and employer contributions), [2] Figure your HSA deduction, [3] Report distributions from HSAs, and [4] Figure amounts you must include in income and additional tax you may owe if you fail to be an eligible individual." (Internal Revenue Service [IRS])
Defective Health Plan Designs May Defeat HSA Enrollment
"[O]ne of two design strategies may help you counter the selection bias ... [1] Move to full replacement with two HSA-capable health options. Instead of comparability, match employee contributions to the HSA.... [2] If you retain a choice design, consider changing the PPO and HMO designs to be consistent with the HSA-capable health option so that employees can clearly compare the point-of-enrollment and point-of-purchase cost sharing." (Plan Sponsor Council of America [PSCA])
[Opinion] ECFC Applauds Report on Reforming the Healthcare System by Increasing Consumer Choice
"[The report prepared by DOL, HHS, and the Treasury Department] outlines several legislative changes that could be made to increase the use of HSAs by: [1] Allowing innovative insurance products (such as those that provide payment for generic drugs below the deductible or fixed fee payments for primary care) to be coupled with HSAs; [2] Allowing individuals enrolled in a health insurance plan with a 70 percent actuarial value (AV), or below, to contribute to an HSA; and [3] Raising the contribution limits to HSAs." (Employers Council on Flexible Compensation [ECFC])
Don't Walk Back on Your HSA Strategy
"[One recent study] showed that 65% of participants use [HSA] funds on immediate expenses, resulting in 45% of accounts with balances less than $5,000.... [Another study] showed that diabetics who were involuntarily switched from a traditional to a high deductible plan, were more likely to delay necessary care. So if HSAs are a good idea, how do we make this a better experience without patients avoiding necessary care?" (Frenkel Benefits)
ACA: Limits, Fees and Penalties Through 2019
"The [ACA] contains a number of limits and penalties that apply to employers.... Employers use one of the three allowable safe harbor compensation methods to determine affordability ... Penalties for failure to comply with the Employer Shared Responsibility provision.... Flexible Spending Accounts ... Health Savings Account (HSA) ... Transportation Fringe Benefits ... Patient-Centered Outcomes Research (PCORI)". (OneDigital Health and Benefits)
Deposit Interest Rates in Health Savings Accounts
"Recent averages suggest providers may not be feeling much pressure to raise HSA deposit rates, with the largest providers feeling even less pressure as they focus on creating account value through other means." (Devenir)
IRS Updates Health and Fringe Benefit Plan Limits
"The IRS has updated various health and fringe benefit plan limits for 2019. A comparison of the 2019 and 2018 limits is listed [in a chart]." (Kilpatrick Townsend)
[Official Guidance] Text of IRS 2018 Instructions for Forms 1099-SA and 5498-SA: Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, and HSA, Archer MSA, or Medicare Advantage MSA Information (PDF)
"Due to the very low volume of paper Forms 1099-SA and 5498-SA received and processed by the IRS each year, these forms have been converted to an online fillable format.... File Form 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, to report distributions made from a health savings account (HSA), Archer medical savings account (Archer MSA), or Medicare Advantage MSA (MA MSA). The distribution may have been paid directly to a medical service provider or to the account holder. A separate return must be filed for each plan type." [Also released: 2018 Form 5498-SA.] (Internal Revenue Service [IRS])
What Fees Reveal About Your HSA Provider
"Friction is caused by the degree of difficulty to access HSA investments, which could be in terms of excess fees, non-integrated trading platforms, unnecessary forms, or other red tape. The easier it is for your employees to invest their HSA is an indication of a provider's understanding of and alignment with your employee's long-term HSA investment success." (HealthEquity)
The Impact of Health Status and Use of Health Care Services on Disenrollment From HSA-Eligible Health Plans
"Overall, 5 percent of HSA-eligible health plan enrollees in 2013 and 2014 switched to a different type of health plan in 2014 and 2015.... There is evidence that individuals who disenrolled from HSA-eligible health plans were more likely to have certain health conditions than those who remained enrolled in the HSA-eligible health plan.... Individuals with multiple conditions were even more likely to disenroll.... Individuals with claims related to childbirth were twice as likely as those with no health conditions to disenroll from HSA-eligible health plans." (Employee Benefit Research Institute [EBRI])
Top 10 HSA Providers: Morningstar 2018 Assessment
"Transparency remains low for many of the top HSA providers ... Investment menu designs have improved, with several plans ... reducing investment menu overlap or adding core investment options.... Fees vary across HSA plans but remain elevated.... [T]he average cost for passive funds ranges from roughly 0.30% to 0.75% per year, and the average for active funds from about 0.80% to 1.20%. Eight of the 10 plans require investors to keep $1,000 or $2,000 in a checking account before they can invest, which can create an opportunity cost." (Morningstar)
Making HSA-Qualified Health Plans Work for Low-Income Employees
"Key elements of this strategy include: [1] Offering employees a matching contribution of $250 to $500.... [2] Offering an annual upfront employer HSA contribution seed of $500 to $1,000 that helps workers and their families, especially those with lower incomes, cover healthcare costs and establish a financial cushion early in the plan year. [3] Making employer contributions income-tiered so that low-income employees and their families get the full employer seed amount while higher-income workers get progressively lesser amounts." (HealthEquity)
[Official Guidance] Text of IRS 2019 Instructions for Forms 1099-SA and 5498-SA: Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, and HSA, Archer MSA, or Medicare Advantage MSA Information (PDF)
"Due to the very low volume of paper Forms 1099-SA and 5498-SA received and processed by the IRS each year, these forms have been converted to an online fillable format.... File Form 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, to report distributions made from a health savings account (HSA), Archer medical savings account (Archer MSA), or Medicare Advantage MSA (MA MSA). The distribution may have been paid directly to a medical service provider or to the account holder. A separate return must be filed for each plan type." [Also released: 2018 Form 5498-SA and 2019 Form 5498-SA.] (Internal Revenue Service [IRS])
Annual Savings Trends Report Reveals How Individuals Are Saving for Their Financial Futures
"Retirement savers ages 25 to 34 are most likely to be on track to meet their retirement goals.... Plans designed with automatic enrollment features see an average participation rate of 80%, which is 10 percentage points higher than participation in plans without automatic enrollment.... 401(k) account balances across all generations and income ranges are relatively low compared to what most experts suggest will be required to cover retirement goals." (Ascensus)
The Effect of Employer-Provided Telemedicine Benefits on Employee HSA Eligibility
"[1] Clearly communicate to employees enrolled in an HDHP that use of the telemedicine benefit will prohibit contributions to the HSA bank account. [2] Include telemedicine program in any COBRA offer of coverage. [3] If offering benefits through a cafeteria plan, offer telemedicine contributions as pre-tax elections. [4] Prepare and file a Form 5500 for any telemedicine plan with 100 or more participants ... [5] Discontinue the offer of telemedicine services to those enrolling in the HDHP and who have, will have, an HSA bank account, until the time that any new regulatory guidance is rendered." (OneDigital Health and Benefits)
Health Savings Account Balances, Contributions, Distributions, and Other Vital Statistics, 2017
"Enrollment in high-deductible, HSA-eligible health plans was estimated to be between 21.4 and 33.7 million policyholders and their dependents and covered nearly 3 in 10 employees in 2017. The HSA market did not exist until 2004.... 95 percent of HSAs with individual or employer contributions in 2017 ended the year with funds to roll over for future expenses.... One-half of HSA owners contributed to their account in 2017, and 36 percent of HSAs did not receive any contributions (individual or employer) in 2017." (Employee Benefit Research Institute [EBRI])
Despite HSA Popularity, Owners Not Maximizing Contributions or Investments (PDF)
"Half of HSA owners contributed to their account in 2017, and 36 percent of HSAs did not receive any contributions (individual or employer) in 2017. Among accounts with contributions, individual contributions in 2017 averaged $1,949 and employer contributions averaged $895. Only 13 percent of account holders contributed the fully allowable annual amount. Investment potential was even less realized. A mere four percent of HSA owners had invested assets beyond cash." (Employee Benefit Research Institute [EBRI])
Choosing the Right Flexible Benefit for Employees
"Trying to decide which of the many employer-sponsored benefits out there to offer employees can leave an employer feeling lost in a confusing bowl of alphabet soup -- HSA? FSA? DCAP? HRA? ... While there are many details to cover for each of these benefit options, perhaps the first and most important question to answer is: which of these benefits is going to best suit the needs of both my business and my employees?" (United Benefit Advisors)
Administration Provides New Health Options for Small-Business Employees
"Americans should have more options than one plan their employer selects for them. And they should be able to maintain their insurance when they change employers or exit the job market to raise a family or care for a sick loved one. That's why the administration is proposing a regulation that would create a new way for employers to provide health coverage for employees. This proposal would give millions of workers and their families more control over their health care. It also holds the promise of more-efficient health-care spending, expanded business growth, and higher wages." (Alexander Acosta, Steven Mnuchin and Alex Azar, via The Wall Street Journal; subscription may be required)
[Official Guidance] Text of IRS Publication 5157A: Volunteer Income Tax Assistance (VITA)/Tax Counseling for the Elderly (TCE): Affordable Care Act - Taxpayer Scenarios for 2018 Returns (PDF)
52 pages. "The purpose of the following examples is to give volunteers an opportunity to practice completing forms and worksheets associated with the [ACA] tax provisions. Adequate information is provided to prepare simple tax returns with various health insurance coverage scenarios that you may encounter. Following each scenario are screen shots from the tax preparation software that will allow you to check your work. " [Rev. Oct. 2018] (Internal Revenue Service [IRS])
Employees Missing Out on the Benefits of Health Savings Accounts
"While HSAs can be a high-value option to help employees prepare for health care costs in retirement, most employees use them primarily as spending accounts for immediate health expenses. Two-thirds of respondents (65%) use their HSA money for current health care needs, large and small, while 8% focus on saving their funds for the future. Because employees regularly use HSAs to pay for current health costs, less than half (45%) have more than $5,000 saved." (Willis Towers Watson)
[Official Guidance] Text of IRS Publication 4942: Volunteer Income Tax Assistance (VITA) / Tax Counseling for the Elderly (TCE) Specialty Course -- Health Savings Accounts (PDF)
54 pages. "This course was developed to help volunteers assist taxpayers who have an HSA. HSAs allow individuals with high-deductible health insurance to use tax-deductible contributions to pay qualified medical expenses. The course covers: [1] HSA eligibility, contributions, and distributions; [2] Reporting HSA activity on Form 8889, Health Savings Accounts; [3] Determining the HSA deduction." [Rev. 10‑2018] (Internal Revenue Service [IRS])
[Official Guidance] Text of IRS Publication 4885: Screening Sheet for Health Savings Accounts (HSA) (PDF)
"Only volunteers with Health Savings Account Certification may assist taxpayers with HSA issues.... This Screening Sheet will help you identify HSA issues that are within the scope of the VITA/TCE program. Use the Determine HSA Eligibility section to determine if taxpayer is eligible for an HSA; use Part I for contributions/deduction; use Part II for distributions." [Rev. 10‑2018] (Internal Revenue Service [IRS])
Health Savings Accounts: Some Frequently Asked Questions and Answers (PDF)
"If an employee terminates employment, can an employer retrieve the employer contributions it made to the terminated employee's HSA account? ... If an employer contributes to HSAs and is subject to FMLA, is the employer required to continue HSA coverage during FMLA leave like other health plan coverage? ... Is a plan document, summary plan description, Annual 5500 reporting, or COBRA continuation coverage required for HSAs, like other plans? ... How does the state tax treatment of HSAs differ from federal tax treatment?" (EPIC)
Little-Known Loophole Allows Some Families to Save Beyond the Max in HSAs
"If you and your spouse share a single family HSA and you both are 55+, only one of you can make the $1,000 catch-up contribution to the HSA. The workaround is easy, though. One of you opens a second HSA to which you contribute your $1,000 catch-up contribution.... If you have an adult child still covered by your medical plan (under age 26, per the [ACA]), the opportunity to stash some tax-free cash is even greater." (Financial Finesse)
A Closer Look at Health Savings Accounts: An Overlooked Retirement Savings Vehicle
"Legislation has been proposed to enhance HSA accounts ... [1] An HSA could be used to pay for over-the-counter medications. [2] HSA contribution limits would be raised to $6,650 for individuals and $13,000 for families ... [3] Individuals who are actively employed but participating in Medicare Part A and covered by a qualifying HDHP would be able to contribute to and HSA. [4] Flexible spending account (FSA) and health reimbursement account (HRA) balances could be transferred to an HSA.... [5] Individuals would no longer be barred from contributing to an HSA if his/her spouse is enrolled in a medical FSA." (Cammack Retirement Group)
Proposed Legislation Would Expand HSAs
"[T]he 'Restoring Access to Medication and Modernizing Health Savings Accounts Act' [H.R. 6199] ... would allow people to participate in direct primary care arrangements (DPCAs) and remain eligible to maintain an HSA as long as the DPCA's monthly fee doesn't exceed $150 for individuals or $300 for families.... [E]mployers would be allowed to offer various free or discounted medical services, either onsite or at a retail clinic, to employees without jeopardizing employees' HSA eligibility.... [T]he 'Increasing Access to Lower Premium Plans and Expanding Health Savings Accounts Act' [H.R. 6311] ... proposes raising contributions from $3,450 to $6,650 for individuals and $6,900 to $13,300 for families, practically doubling the limit." (DataPath)
[Guidance Overview] ACA Numbers and Limits 2014-19: Reference Guide (PDF)
One-page chart lists various dollar limits for 2014‑2019, including: [1] 4980H Large Employer Shared Responsibility Penalty; [2] 5000A Individual Shared Responsibility Penalty; [3] 36B Marketplace Subsidies/Premium Tax Credits (PTC); [4] Health Insurance Reforms; and [5] Health Savings Accounts. (Kaufman & Canoles, P.C.)
[Opinion] Stop Making 401(k) Contributions -- Fill Up Your HSA First
"HSAs are triple tax-free ... HSA payroll contributions are truly tax-free ... No use it or lose it ... Paying retiree health care expenses ... No age 70‑1/2 minimum distribution requirements ... Contribution limits ... HSAs and retirement planning ... Investing HSA contributions important." (Robert C. Lawton, via Forbes)
Could HSAs Be Getting a Make-Over?
"Congress is working on two bills that may significantly change those rules to make [HSAs] more manageable.... [1] Eligible expenses would include the purchasing of over-the-counter medications with a health savings account (HSA), flexible savings account (FSA), or a health reimbursement account (HRA) without requiring a prescription. [2] Certain sports and fitness expenses, including gym memberships, would qualify as medical expenses up to a limit of $500 a year for an individual. [3] HSA contributions limits would be raised to align with out-of-pocket limits of the [ACA].... [4] HSAs opened within 60 days after gaining coverage under a HDHP will be allowed to operate as if they had been opened on the same days as the HDHP." (Hill, Chesson & Woody)
Participants Mostly in the Dark About HSA Benefits
"EBRI's database shows only 6% of HSA accounts that were opened in 2016 had the maximum contribution.... However, when EBRI looked at HSA accounts that were opened in earlier years, it found a consistent pattern of more maximum contributions taking place in 2016 depending on how long someone used an HSA." (Pensions & Investments)
Person-Centered Strategies: Health Savings Accounts
"The HSA tax structure provides a number of opportunities for consumers to save for important health care expenses, to be prepared for medical emergencies, and even to plan for retirement down the road.... While anyone with an eligible HDHP can open and use an HSA, self-employed and business owners may particularly benefit from these types of plans.... HSAs have grown in popularity within the group market, and they remain an area that has a lot of opportunity for growth on the Exchanges and the individual market." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])
2018 Midyear HSA Research Report
"HSA consumers had accumulated $51.4 billion in their HSA at the end of June, a year over year increase of 20.4%.... The total number of HSAs grew to 23.4 million at the end of June, up 11.2% from a year ago.... Overall, accounts grew by 5.2% in the first half of 2018, compared with 5.0% in 2017, 8.5% in 2016, and 5.5% in 2015.... HSA investment assets reached an estimated $9.8 billion at the end of June, up 45% year over year.... Direct employer relationships are the leading driver of new account growth, accounting for 42% of new accounts opened in the first half of 2018." (Devenir)
HSAs Can Reduce Your Employees' Fear of High Deductibles
"[T]he easiest way to put your employees' minds at ease is for you to contribute to their HSA to provide a cushion.... Another option would be to offer a match of employee contributions.... [Consider] attaching a Post-Deductible Health Reimbursement Arrangement (HRA)." (OneDigital Health and Benefits)
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