2016 Inflation Adjusted Amounts for HSAs and HDHPs
|
05/08/2015
|
By: Jason Lacey
|
The
IRS
has
released
the
2016
inflation-adjusted
amounts
for
health
savings
accounts
(HSAs)
and
high-deductible
health
plans
(HDHPs).
HDHP
Minimums
and
Maximums.
The
minimum
annual
deductible
for
an
HDHP
will
be
$1,300
for
self-only
coverage
and
$2,600
for
family
coverage.
These
amounts
have
not
changed
from
the
2015
amounts.
The
maximum
annual
out-of-pocket
for
an
HDHP
will
increase
to
$6,550
for
self-only
coverage
and
$13,100
for
family
coverage.
"Embedded"
ACA
Out-of-Pocket
Maximum.
The
Affordable
Care
Act
also
sets
out-of-pocket
maximums
for
non-grandfathered
plans.
For
2016,
the
ACA
maximum
will
be
$6,850
for
self-only
coverage
and
$13,700
for
family
coverage
(compared
to
$6,550
and
$13,100
for
HDHPs).
In
addition,
recent
HHS
guidance
provides
that,
beginning
in
2016,
the
self-only
ACA
out-of-pocket
maximum
must
be
"embedded"
within
the
family
ACA
out-of-pocket
maximum,
meaning
that
no
individual
may
be
subject
to
out-of-pocket
expenses
in
excess
of
the
self-only
maximum.
In
the
case
of
a
plan
intended
to
be
an
HDHP,
this
means
that
(1)
the
out-of-pocket
maximum
cannot
exceed
the
lower
maximum
applicable
to
HDHPs,
and
(2)
the
out-of-pocket
maximum
for
an
individual
covered
under
a
family
plan
cannot
exceed
the
ACA
maximum
for
self-only
coverage.
Example.
An
HDHP
for
2016
has
a
family
deductible
of
$13,100,
with
no
other
cost
sharing.
This
is
permissible
because
it
does
not
exceed
either
the
ACA
out-of-pocket
maximum
limit
($13,700)
or
the
lower
HDHP
out-of-pocket
maximum
limit
($13,100).
However,
the
plan
must
further
provide
that
no
member
of
the
family
will
be
required
to
contribute
more
than
$6,850
toward
Continue Reading...
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|
2015 Inflation Adjusted Amounts for HSAs and HDHPs
|
06/20/2014
|
By: Jason Lacey
|
The
IRS
has
released
the
2015
inflation-adjusted
amounts
for
health
savings
accounts
(HSAs)
and
high-deductible
health
plans
(HDHPs).
HDHP
Minimums
and
Maximums.
The
minimum
annual
deductible
for
an
HDHP
will
increase
to
$1,300
for
self-only
coverage
and
$2,600
for
family
coverage.
The
maximum
annual
out-of-pocket
for
an
HDHP
will
increase
to
$6,450
for
self-only
coverage
and
$12,900
for
family
coverage.
Relationship
to
ACA
Maximum
Out-of-Pocket.
The
Affordable
Care
Act
also
sets
out-of-pocket
maximums
for
non-grandfathered
plans.
For
2014,
the
ACA
maximum
and
the
HDHP
maximum
are
the
same.
But
the
amounts
are
indexed
at
different
rates,
and
for
2015
they
will
be
different.
The
ACA
maximum
will
be
$6,600
for
self-only
coverage
and
$13,200
for
family
coverage
(compared
to
$6,450
and
$12,900
for
HDHPs).
What
does
this
mean?
A
plan
designed
to
satisfy
the
ACA
maximums
will
not
necessarily
qualify
as
an
HDHP.
It
will
need
to
satisfy
the
lower
maximum
applicable
to
HDHPs.
Maximum
HSA
Contribution.
The
maximum
annual
contribution
to
an
HSA
for
2015
will
increase
slightly
to
$3,350
for
an
individual
with
self-only
HDHP
coverage
and
$6,650
for
an
individual
with
family
HDHP
coverage.
Catch-up
contributions
for
individuals
age
55
and
older
are
not
inflation-adjusted
and
remain
at
$1,000
per
year.
Recall
that
these
annual
maximums
are
prorated
on
a
monthly
basis
for
an
individual
who
is
covered
under
an
HDHP
for
less
than
the
full
year.
Also,
special
rules
apply
when
one
or
both
spouses
have
HDHP
coverage,
with
the
general
effect
of
limiting
the
household
to
a
single
family-level
Continue Reading...
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|
IRS Clarifies Impact of Health FSA Carryover on HSA Eligibility
|
04/10/2014
|
By: Jason Lacey
|
An
internal
IRS memorandum
has
provided
much-needed
clarification
on
the
interaction
between
the
new
$500
carryover
rule
for
health
FSA
plans
and
eligibility
to
make
contributions
to
a
health
savings
account
(HSA).
The
conclusions
in
the
memo
are
generally
favorable,
but
employers
wanting
to
both
offer
the
carryover
rule
in
a
health
FSA
and
allow
employees
to
be
HSA-eligible
will
need
to
carefully
design
their
health
FSA
plans
to
take
advantage.
Background.
In
guidance
issued
last
year,
the
IRS
provided
limited
relief
from
the
use-it-or-lose-it
rule
that
applies
to
health
FSA
plans
by
allowing
for
a
carryover
of
up
to
$500
of
unused
amounts
each
year.
(See
my
post
here.)
Among
the
open
questions
was
how
this
carryover
would
affect
an
individual's
eligibility
to
make
HSA
contributions
and
what
steps,
if
any,
could
be
taken
to
ensure
an
individual
would
be
HSA-eligible
if
the
individual
had
a
carryover
amount.
In
general,
to
be
HSA-eligible,
an
individual
cannot
have
any
low-deductible
health
coverage,
including
coverage
under
a
general-purpose
health
FSA.
Carryover
Affects
HSA Eligibility
for
Entire
Year.
In
this
recent
memorandum,
the
IRS
confirmed
that
an
individual
who
has
a
carryover
amount
in
a
general-purpose
health
FSA
is
ineligible
to
contribute
to
an
HSA
for
the
entire
carryover
year,
even
after
the
individual
exhausts
the
balance
in
the
health
FSA.
For
example,
if
at
the
end
of
2014
an
individual
has
$400
remaining
in
a
general-purpose
health
FSA
and
that
amount
carries
over
to
a
general
purpose
health
FSA
for
2015,
the
individual
will
Continue Reading...
|
|
IRS Clarifies Impact of Preventive Care Services on HDHPs
|
09/09/2013
|
By: Jason Lacey
|
The
IRS
has
provided
an
expected,
but
welcome,
clarification
(see
Notice
here)
regarding
the
impact
of
providing
no-cost
preventive
care
services
under
a
high-deductible
health
plan.
Background.
To
be
eligible
to
contribute
to
a
health
savings
account
(HSA),
an
individual
must
be
covered
under
a
qualifying
high-deductible
health
plan
(HDHP)
and
must
not be
covered
under
any
low-deductible
coverage,
other
than
permitted
coverage.
Permitted
coverage
incudes
coverage
for
preventive
care
services
within
the
meaning
of
Internal
Revenue
Code
Section
223(c)(2)(C).
Health
Care
Reform.
Under
health
care
reform,
non-grandfathered
health
plans
are
required
to
offer
specified
preventive
care
services
without
cost
sharing.
This
rule
applies
to
non-grandfathered
plans
that
otherwise
meet
the
requirements
to
be
an
HDHP.
But
the
preventive
care
services
required
under
health
care
reform
are
not
quite
the
same
as
preventive
care
services
described
in
guidance
under
Code
Section
223(c)(2)(C).
And,
of
course,
there
cannot
be
a
deductible.
So
we
have
wondered:
Will
compliance
with
the
preventive
care
mandate
under
health
care
reform
risk
causing
a
plan
to
no
longer
qualify
as
an
HDHP?
Guidance.
The
assumption
has
been
that
the
IRS
would
not
view
preventive
care
services
provided
in
accordance
with
health
care
reform
as
impermissible
low-deductible
coverage.
Otherwise
HDHPs
could
effectively
no
longer
exist,
unless
they
remained
grandfathered.
That
assumption
has
now
been
confirmed:
"[A] health
plan
will
not
fail
to
qualify
as
an
HDHP
under
section
223(c)(2)
of
the
Code
merely
because
it
provides
without
a
deductible
the
preventive
care
health
services
required
under
section
2713
of
the
PHS Act
to
Continue Reading...
|
|
2014 Inflation Adjusted Amounts for HSAs and HDHPs
|
05/24/2013
|
By: Jason Lacey
|
The
IRS
has
released
the
2014
inflation-adjusted
amounts
for
health
savings
accounts
(HSAs)
and
high-deductible
health
plans
(HDHPs).
The
changes
are
not
large,
but
most
of
the
key
metrics
will
see
some
increase.
HDHP
Minimums
and
Maximums.
The
minimum
annual
deductible
for
an
HDHP
will
remain
unchanged
at
$1,250
for
self-only
coverage
and
$2,500
for
family
coverage.
The
maximum
annual
out-of-pocket
for
an
HDHP
will
increase
to
$6,350
for
self-only
coverage
and
$12,700
for
family
coverage.
>>Why
do
we
care? Whether
health
coverage
qualifies
as
HDHP
coverage
is
important
because
an
individual
must
have
HDHP
coverage
to
be
eligible
to
contribute
to
an
HSA.
>>Interaction
with
health
care
reform.
These
amounts
relate
only
to
compliance
with
the
HSA
requirements.
Health
care
reform
will
impose
further
limits
on
deductibles
and
out-of-pocket
maximums
beginning
in
2014
(see
prior
coverage
here),
and
plans
will
need
to
satisfy
those
requirements
in
addition
to
the
conditions
necessary
to
be
an
HDHP.
Maximum
HSA
Contribution. The
maximum
annual
contribution
to
an
HSA
for
2014
will
be
$3,300
for
an
individual
with
self-only
HDHP
coverage
and
$6,550
for
an
individual
with
family
HDHP
coverage.
Catch-up
contributions
for
individuals
age
55
and
older
are
not
inflation-adjusted
and
remain
at
$1,000
per
year.
Recall
that
these
annual
maximums
are
prorated
on
a
monthly
basis
for
an
individual
who
is
covered
under
an
HDHP
for
less
than
the
full
year.
Also,
special
rules
apply
when
one
or
both
spouses
have
HDHP
coverage,
with
the
general
effect
of
limiting
the
household
to
a
single
family-level
HSA
Continue Reading...
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Editors
Don Berner, the Labor Law, OSHA, & Immigration Law Guy
Boyd Byers, the General Employment Law Guy
Jason Lacey, the Employee Benefits Guy
Additional Sources

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