HSA News for April 12, 2021
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Biden $1.5T Budget Proposes Major Hike in Social Programs
President Biden proposed a $1.5 trillion annual budget for fiscal 2022, $118 billion higher than the regular 2020 appropriations, featuring a significant 16 percent boost in non-defense spending.
Senate Parliamentarian to Let Democrats Bypass GOP Filibuster on Two Bills
The Senate parliamentarian ruled that Democrats can use special budgetary rules to avoid a GOP filibuster on two more pieces of legislation, setting the stage for President Biden's infrastructure agenda to pass in two packages with simple-majority votes.
HSA Studies & Analysis
Investments Becoming a Bigger Chunk of HSA Assets
Invested assets in HSAs jumped last year, fueled by market returns, and now account for a bigger overall chunk of the business, according to a new report by Devenir. The invested money reached $23.8 billion at the end of 2020, up more than 51% from the $15.7 billion seen at the end of 2019. The invested money now represents 29% of the $82.2 billion HSA market, up from 24% a year earlier.
HSA Compliance Corner
Only Plan Subscribers Can Contribute to an HSA? Nope!
The Health Savings Account rules restrict who can open and fund an account. But too often people don't realize the doors that remain legally open for two or more family members to establish and contribute to an account, thereby extending tax benefits to more family members.
Correcting Excess HSA Contributions
How should employers and employees address mistaken HSA contributions in excess of the statutory limit? Employers can work with the HSA custodian to return excess contributions made through their payroll, but any other excess contribution will require the employee to take a corrective distribution directly from the HSA custodian.
HSA Industry News
HealthEquity to Acquire Further
HealthEquity has announced that it has entered into a definitive agreement to acquire Further, a provider of HSA and consumer-directed benefit administration services, as well as an HSA custodian. The deal is expected to close in September.
New TIAA Resource Center Showcases HSA Benefits, Uses Based on Personality Type
TIAA has launched its HSA Resource Center developed to engage and educate people on how to make their health savings work for them at different life stages.The new site offers helpful information on HSA ownership, HSA use as a component of a retirement savings strategy and helpful tips to optimize account contributions.
HealthSavings Administrators Announces Integration with Employee Navigator
HealthSavings Administrators announced an integration with Employee Navigator, a prominent benefits administration solution for brokers. The integration allows brokers to seamlessly view and manage clients’ HealthSavings HSAs in the same intuitive platform as the rest of their health benefits suite.
HSA Industry Best Practices
Want to Spur HSA Use? Borrow Lessons From Retirement Planning
While few retirees have any idea what their health expenses will be, administrators can leverage many of the lessons they’ve learned from work to boost participation in retirement accounts to encourage the use of HSAs. Those lessons offer insights into helping workers see saving for healthcare as a subset of building lifetime financial security. Here’s a look at three ways to encourage HSAs.
3 Ways to Overcome High Barriers Set by High Deductibles
A recent paper from Voya and SAAVI Financial notes that confusion and inertia lead employees to select suboptimal health plans, reducing their ability to save effectively for retirement. Voya recommended three steps to help employees overcome barriers to choosing the more optimal plan for them and their families.
The HSA Market
The Future of HSAs in Three Approaches to Reform
The three potential big changes--a public option, extension of Medicare to a below-65 population, and a government monopoly over the design, funding, and delivery of all medical care--are some Democrats favorite options for reforming healthcare. Let's look at each proposal and its effect on HSAs.
HSAs & Retirement
HSAs: The Underutilized Retirement Savings Vehicle
It might surprise you that one of my favorite retirement savings vehicles is a Health Savings Account. If used strategically, HSAs can be used as a powerful retirement planning tool. There are three features of HSAs that make them a viable retirement savings vehicle.
Americans Are Underestimating Their Senior Healthcare Costs -- and Could Wind Up Broke in Retirement Because of It
Health issues have a tendency to arise as people get older, so seniors are often burdened with medical bills at a time when they're trying to adjust to living on a fixed income. It's for this reason that estimating future healthcare costs -- and saving for them accordingly -- is so crucial. Yet a recent Fidelity survey reveals that most people are underestimating the cost of healthcare during retirement.
These Big Expenses Could Drain Your Retirement Savings if You Aren't Prepared for Them
If your nest egg isn't big enough to cover three big expenses you're likely to encounter in retirement, you could find yourself in serious financial trouble. The cost of healthcare is one of the biggest shocks many seniors face. Unfortunately, far too many people anticipate they'll need to spend only between $50,000 and $100,000 on care throughout their later years, far below most estimates.
Vanguard Report Underscores the Power of Automatic Enrollment
According to a new report from Vanguard, over time, 90% of participants who are automatically enrolled in their retirement plan increase their deferral rates, either through automatic escalation or on their own.
Consumer-Driven Health Care
Surprising Amazon Items that Are FSA and HSA Eligible
As you may know, Amazon accepts FSA or HSA cards as a means of payment on certain eligible healthcare products — but you might be surprised at what’s included in the mix. You’re not limited to just cold meds, glucometers and crutches.
FAIR Health Unveils Three New Enhancements to Consumer Platform, Including Shoppable Services Tool
FAIR Health is unveiling three new enhancements to its platform of online resources to support consumers as they navigate the healthcare system. FAIR Health has added a shoppable services tool to its free website and launched a free mobile app to deliver health insurance education to consumers in a user-friendly, consolidated format.
Quest Diagnostics Sees D2C as Future of Consumer-Driven Healthcare
Since the end of 2018, demand for consumer-driven home testing has surged. That change is part of a broader trend regarding the consumerization of healthcare and is bringing the expectations of eCommerce to the medical world. Quest Diagnostics launched its consumer-initiated testing program, QuestDirect, which allows consumers to order at-home testing kits for 49 different conditions.