Health care reform
The IRS has announced adjustments that will affect Health Savings Accounts (HSA) and High Deductible Health Plans (HDHP) in 2015.
An HSA is a fund employees can use to build up tax-free dollars to pay for current and future qualified medical expenses, as well as future retiree health expenses. Individuals can choose to spend any accumulated dollars on expenses as they arise, or save the dollars for later withdrawal. To be eligible for an HSA, an employee:
HSA accounts are becoming more popular, as HDHPs and consumer-directed health plans become more common. Employers often combine a lower-premium High Deductible Health Plan with an HSA and voluntary benefits, like accident or critical illness coverage — allowing employees to choose the coverage they need to offset their potential financial risk. Unum has updated a quick reference guide to using HSAs as a cost control strategy; view it here.
What you need to know now
The amount employees can contribute to an HSA has been increased for 2015. The new contribution limits are:
The minimum required deductibles for HDHP plans have been increased to these amounts:
The maximum amount an employee can pay for out-of-pocket expenses has also been increased for 2015:
Out-of-pocket expenses include deductibles, co-payments, and other amounts — but not premiums.
The IRS changes can give consumers access to additional funds to cover qualified expenses and increases in medical expenditures.
Employers are required to communicate these changes to employees, and will need to make sure their health insurance deductibles and HSA plans comply with the new regulations.
Brokers will need to work with their clients to communicate these changes to employees and make sure the health insurance plan design they present is compliant with the new guidelines.