HSA News for December 23, 2019
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Appeals Court Strikes Obamacare Mandate, Sends Case Back to Lower Court
On December 18, a federal appeals court ruled that Obamacare's individual mandate is unconstitutional, but punted on the larger question of what it means for the rest of the health law. The Fifth Circuit Court of Appeals remanded the case back to a federal judge in Texas to decide just how much of the rest of the law, if any, is also unconstitutional.
Trump Signs $1.4 Trillion Spending Package, Averting Shutdown; Cadillac Tax Repealed
On December 20, President Trump signed two spending packages totaling $1.4 trillion, averting a government shutdown at midnight. Among the provisions included in the bill is a complete repeal of the Affordable Care Act's tax on high cost health plans, also known as the "Cadillac tax."
Lawmakers Try to Find Next Opportunity to Tackle Drug Prices, Surprise Billing After Setback
Congress is expected to pass a major spending bill this week that does not include any legislation on drug prices or surprise medical bills, despite both having wide bipartisan support. Lawmakers are turning their calendars to May as the next logical place to get the legislation done. But first they must mend major differences on the top healthcare priorities.
Trump Administration Releases Plan for States to Import (Some) Drugs From Canada
On December 18, the Trump administration proposed a new pilot project to enable states to import drugs from Canada and that would enable drug companies to voluntarily import their products. The proposed rule outlines a pilot project where states and non-federal government entities would apply to the FDA to import certain prescription drugs from Canada.
HSA Industry News
T. Rowe Price to Integrate HSA Offering With Recordkeeping Platform
T. Rowe Price Retirement Plan Services Inc. announced that it will offer integration of ConnectYourCare’s HSA into its retirement plan offering. ConnectYourCare will serve as the product administrator and custodian.
HSAs & Retirement
American Seniors Withdrew $22 Billion in 1 Year to Cover Healthcare
A Gallup poll this year showed that seniors withdrew an estimated $22 billion from long-term savings over a 12-month period to cover the cost of healthcare. An estimated 6.3 million seniors said they withdrew an average of $3,521 in the past 12 months to fund medical costs. For those who are not yet retired, this is a troubling wake-up call underscoring the importance of saving for healthcare.
Baby Boomers Are Worried About Healthcare Costs -- So Why Aren't More Doing Something About It?
Though healthcare is a major burden for Americans of all ages, older adults are exceptionally concerned about it. But surprisingly, when asked about reducing that risk, only 7% were quick to identify HSA contributions as a means of mitigation. It pays to take advantage of an HSA as long as you're still working. Having an HSA will give you a dedicated source of income to cover that expense category.
7 HSA FAQs for Advisors & Their Clients
Although much has been made of HSAs as a saving-then-spending vehicle for health care, they are also an investment tool, and a way to prepare for health care expenses in retirement. Knowing a little about various compliance issues and questions can help expand an advisor’s value proposition. Here are 7 FAQs that reveal more about these topics.
A Free Market Solution Within Medicare
Within Medicare there currently exists a free market alternative. It is a little known program called Medicare Medical Savings Accounts (MSAs). These plans combine the protection of a high-deductible Medicare insurance plan with the autonomy of a patient controlled Medicare-funded account. They are available to enrollees through the very popular Medicare Advantage program.
Maximizing Your HSA
How Much Should You Contribute to Your HSA?
Let's tackle the question of how much you should contribute to that HSA. One strategy is to use the account for your current-year medical expenses. Alternatively, you could take a longer-term view and use your HSA to save for retirement. In that case, you'd want to start maxing out those HSA contributions immediately. Here are four reasons that makes sense.
3 Ways HSAs Save You Taxes
If an HSA is available to you, then it's worth you while to take a closer look -- because HSAs have a triple tax-free advantage that you'll have trouble finding anywhere else. Here, we'll look at the three ways that HSA contributions can save you on your taxes.
Pro-Rate Your HSA Contributions? Maybe, Maybe Not.
One of the questions I’m asked to answer most frequently is how much an HSA owner can contribute if she’s not HSA-eligible all 12 months of the year. It depends. If you become eligible to make and receive contributions to an HSA after January 1 (but no later than December 1), you can contribute more than the pro-rata maximum.
HSA Minimum Cash Balances Come With an Unseen Price
Many HSA providers impose minimum cash balances, meaning account holders must maintain a set amount in cash, typically $1,000 or $2,000, before they can invest additional funds. However, rather than benefiting account holders, minimum cash balances act as a hidden cost by needlessly holding funds captive and throttling account holders’ ability to grow their savings.
Consumer-Driven Health Care
Annual Physicals Are Free, Right? Why Did I Get a Bill?
Your annual physical is supposed to be free, right? So why does it seem like you always get charged when you ask questions about your health? If you have a clean bill of health at your annual physical, you're not going to pay anything. But if you go to your doctor and say something like, "My knee hurts," all of a sudden you might get charged for an office visit.
1 in 3 Americans Is Worried About Rising Healthcare Costs in 2020. Here's How to Make Medical Care More Manageable.
If you're anxious about an uptick in healthcare costs, there are a few things you can do to ease that worry -- and perhaps save yourself some money along the way. Ideally, you should have an emergency fund with money set aside for unplanned expenses, including medical bills. But it also pays to contribute money to an HSA, provided you're eligible.
Unhealthy Eating Habits Cost U.S. $50 Billion a Year: Study
Healthier eating could save the United States more than $50 billion a year in health care costs associated with heart disease, stroke, type 2 diabetes and related illnesses, according to a new study. An unhealthy diet is one of the leading risk factors for poor health and accounts for up to 45% of all deaths from these cardiometabolic diseases, the researchers noted.