HSA News for May 17, 2021
HSA News is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Biden Spending Plans Hit Speed Bumps
President Biden’s latest spending proposals are hitting a series of speed bumps as several recent developments could make getting the measures through Congress more difficult. A disappointing monthly jobs report has Republicans arguing that some of Biden's proposals included in the $1.9 trillion COVID-19 relief bill are actually slowing the recovery by disincentivizing workers to get jobs.
IRS Announces 2022 Limits for HSAs and High-Deductible Health Plans
HSA contribution limits for 2022 are going up $50 for self-only coverage and $100 for family coverage, the IRS announced May 10. The annual limit on HSA contributions will be $3,650 for self-only and $7,300 for family coverage. The IRS also confirmed the minimum deductible and maximum out-of-pocket expenses for the HDHPs with which HSAs are paired.
IRS Extends 2020 HSA Contribution Deadlines in 3 More States Due to Severe Storms
The IRS has announced that they have extended the 2020 tax filing deadline for victims of severe storms in certain counties of Alabama, Kentucky, and Tennessee. The delays move the final date to make HSA contributions for 2020 to June 30, 2021 (Kentucky) and August 2, 2021 (Alabama and Tennessee) for taxpayers residing in the affected areas.
HSA Compliance Corner
Are These Expenses Qualified for Tax-Free Distributions? It Depends
When it comes to HSAs, the account owner categorizes each expense as qualified or non-qualified. But that doesn't mean that you have free rein. At some point, the IRS may have an opportunity to weigh in. And you don't want to have stretched the definition of qualified expenses beyond what the IRS considers valid.
HSA Industry News
Voya to Acquire Benefit Strategies as Part of Push into HSAs
Voya Financial agreed to buy Benefit Strategies, a third-party administrator of health savings and spending accounts. Terms of the deal were not disclosed. The acquisition will accelerate Voya's expansion into the health savings and spending accounts market and support its workplace growth strategy, said Rob Grubka, CEO of health solutions for Voya.
HSAs & Retirement
HSAs Can Save You More for Retirement Than You Know
When it comes to saving (and investing) for healthcare expenses in retirement, there is perhaps no better option than an HSA. Why so? In essence, it’s the tax advantages. Smart HSA account owners are investing their money in mutual funds in hopes of building a nest egg large enough to pay for some or all healthcare costs in retirement, which can be considerable when viewed as a present value.
How HSAs Owners Could Have Avoided Retirement-Plan Penalties
According to a recent survey, one-third of employees withdrew funds from their workplace-based retirement accounts and/or IRAs in 2020, and nearly half found that they borrowed or withdrew more than they needed. It didn't have to be that way. Many ended up paying taxes and penalties on those funds, whether they needed them or not. For medical bills, they could have withdrawn HSA funds tax-free.
Maximizing Your HSA
There’s Still Time to Lower Your Tax Bill With This Last-Minute Move
There’s still time to make HSA contributions for 2020. Those with high-deductible health plans have until the extended tax-filing deadline, May 17, to make HSA contributions for 2020. Self-only plans allow deposits of up to $3,550, while those with family coverage may save as much as $7,100. This last-minute move may trim your tax bill while setting aside funds for future health care, financial experts say.
Consumer-Driven Health Care
Health Savings Accounts and Chiropractic Care
Health Savings Accounts can help consumers afford chiropractic care, even when it is excluded from their health insurance policy, by paying for chiropractic care and other alternative medicine with pre-tax dollars. Another way chiropractors can help clients gain access to chiropractic care is to encourage the use of HSAs.
High-Deductible Plans Are Changing Patient Behavior, ASC Execs Say
Insurers pass risk to patients with high-deductible health plans, and members are becoming savvier about the cost of care as a result. Ambulatory surgery centers, which charge less for the episode of care than hospitals, are a perfect fit for high-deductible plan members shopping for quality care at the best price. ASCs are also seeing more requests for bundled cost estimates from patients.
What Is a High-Deductible Health Plan (HDHP)?
While providing employees with great health insurance options is important, it is not cheap. With high-deductible health plans, you can offer health insurance to your employees without breaking the bank. That said, even if HDHPs save you money, they aren't always right for your employees, so it is important to understand what they are, their ties to other types of health benefits, and their pros and cons.