HSA News for August 10, 2020
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Coronavirus Talks Collapse as Negotiators Fail to Reach Deal
Bipartisan talks aimed at finding a deal on a fifth coronavirus bill collapsed on August 7, all-but-guaranteeing Congress and the White House will not be able to reach a compromise despite a steady uptick in cases and lingering economic aftershocks.
Trump Signs Executive Orders After Coronavirus Relief Talks Falter
On August 8, President Trump signed executive orders to extend unemployment benefits, suspend payroll taxes, and offer federal eviction and student loan relief, taking unilateral action that is on shaky legal ground amid stalled negotiations about a fifth round of coronavirus relief in Congress.
Bill Introduced to Extend HSA, FSA Eligibility to Dietary Supplements
The Natural Products Association said it has worked with Sen. Kevin Cramer (R-ND) to introduce a bill that would allow HSA and FSA funds to be used to buy certain categories of dietary supplements.
HSA Compliance Corner
Mid-Year Enrollees Must Pro-Rate Their HSA Contributions? Nope!
If you (or your clients) are newly eligible to fund an HSA, you're don't have to pro-rate your contributions. HSA owners have a choice: They can pro-rate their contributions or they can place a bet in which winning generates a return of twice the amount bet.
HSA Mistaken Contributions
When can an employer have mistaken HSA contributions returned by the HSA custodian? Although the general rule is that all employer HSA contributions are nonforfeitable, there are three situations that permit employers to correct an error by requesting the HSA custodian return mistaken contributions.
HSA Industry News
Lively Brings Personalized Investment Guidance to Its HSA
Lively has added personalized investment guidance, powered by Devenir, to its HSAs. Now, Lively account holders will have access to personalized investment guidance that can help them capitalize on the HSA’s unique tax advantages with no investment threshold.
HSA Industry Best Practices
What’s Your HSA ‘Personality Type?’
Are you (or your client) a saver or spender? Budgeter, manager, long-term investor? HealthSavings Administrators has identified the six major personalities for individuals that invest in HSAs and have tailored their service options to each. HealthSavings found variations by demographic, psychographic, and behavioral group, then created custom communications to address each persona’s needs.
Employee Engagement Strategy Greatly Increases Benefit Usage, Including HSAs
Fidelity Investments has published a new report showing 89% of employees with an HSA believe the savings account has positively affected their livelihood. Fidelity also reports the more an employer communicates with workers on benefits, the likelier they are to use them.
How Financial Institutions Can Be HSA Champions
This is an opportune time for financial institutions to help customers fill the gap between managing healthcare savings and managing the rest of their financial portfolio. For those financial institutions already looking into HSAs, the next question is: How can you stand out from the competition? Here are a few best practices I’ve seen financial institutions have success with.
The HSA Market
U.S. Employers and Employees Disagree on HSA Utilization
In a recent survey, Further found agreement that a comprehensive benefits package is critical to both employers and employees but notably there were sharp contrasts where employers and employees starkly diverge on how to leverage HSAs – with employers positioning them as savings tools, while employees rely on them as spending tools.
Physician Survey Represents Another "Hit Job" on High Deductible Plans
Too many people don't understand how medical insurance works. That list shouldn't include physicians. But apparently it does. Plans with high deductibles make patients more sensitive to prices. That's important, since those prices translate to costs to the system. No, they're not perfect. But they're here to stay. And providers who haven't adjusted to this reality are failing their patients - and themselves.
HSAs & Retirement
What Will Healthcare in Retirement Cost You? Try $295,000.
Each year, Fidelity releases its annual Retiree Health Care Cost Estimate, and this year, it states that the average 65-year-old couple retiring in 2020 can expect to spend a whopping $295,000 on medical expenses throughout retirement. That represents a 3.5% increase from last year's $285,000 estimate, and an 18% increase since 2010.
How to Save for Retirement With Your HSA
High-deductible plans may offer one benefit, though: the option to contribute to an HSA, which allows you or your employer to set aside pre-tax money for health expenses. A lesser-known strategy is the ability to use your HSA for retirement savings. If you’re not spending the balance every year, you have the option to invest it.
How an HSA Compares to a 401(k) for Retirement Planning
An HSA is a savings vehicle for people who are enrolled in high deductible health plans to save for future medical bills. The features of HSA accounts also make it a very good retirement savings vehicle, and in some ways, are better than a 401(k).
Maximizing Your HSA
HSA: A Long-Term Investment Choice for Employees (Especially Millennials)
Pairing an HSA with an HDHP gives employees of all ages greater flexibility and control over their healthcare spending. But the greatest benefit for the millennial generation is an HSA’s triple tax savings combined with how time can amplify those savings to grow an individual’s account. For example, a 30-year-old can accumulate more than $500,000 assuming a 6% rate of return until age 65 and continued contributions to their account each year.
Consumer-Driven Health Care
Prescription Drugs May Be More Affordable Than You Think — Unless You Pay Cash
Amid growing complaints that many Americans cannot afford their prescription medicines, most people in the U.S. who have insurance are paying lower out-of-pocket costs, but cash-paying customers are shelling out significantly more than five years ago, according to a new analysis.
Haven Was Supposed to Re-Imagine Health Care. An Exodus of Talent Has Gutted It.
Haven, the audacious health venture founded by three of America’s most storied companies, was once a magnet for top-flight talent. But a string of high-profile departures has left the company’s C-suite all but empty. As a result, the company that set out to re-imagine health care more than two years ago has made virtually no progress in reaching that goal and, by all accounts, may never.