HSA News for January 31, 2022
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Democrats Face Scaled-Back Agenda After Setbacks
Democrats are confronting the reality of a scaled-back agenda as they try to move past high-profile setbacks that dominated the tail end of President Biden’s first year in office. After pledging to go “big and bold” when they were swept into power in 2021, Democrats are readjusting their strategy as they head toward November.
125 Organizations Ask Congress to Restore Telehealth Flexibility for HDHP Members
More than 125 organizations are urging Congress to reinstate a provision that allows employers and health plans to provide pre-deductible coverage for telehealth services for those with HSA-qualified health plans. The flexibility expired December 31, but in light of the Omicron variant surge across the country, the organizations believe it needs to be reinstated.
HSA Compliance Corner
IRS Announces Tax Relief for Tennessee Severe Storms, Straight-Line Winds and Tornadoes
Victims of severe storms, straight-line winds and tornadoes beginning December 10, 2021 now have until May 16, 2022, to file various individual and business tax returns and make tax payments, the Internal Revenue Service announced, following the recent disaster declaration issued by the Federal Emergency Management Agency. This includes making HSA contributions for 2021.
HSA Industry News
BCBSA Invests in Digital Health Savings Account Startup
Digital benefits startup First Dollar raised $14 million led by Blue Cross Blue Shield Association's venture arm, with participation from Next Coast Ventures and Meridian Street Capital. The business got its start by focusing on drug discounts through a partnership with RxSaver, and has now expanded to streamline consumer use of tax-advantaged savings accounts, like HSAs or supplemental benefits.
HSA Best Practices
Plan Sponsors Must Bolster HSA Education to Boost Use
HSA owners have not received enough education from plan sponsors to dispel concerns and grow usage because the process takes several steps. For plan sponsors to reach HSA owners with education, employers need to couple an HDHP with an HSA, because not every employer does. Only about 50% of the qualified HDHPs in the country are pre-coupled with an HSA, according to Alegeus.
The HSA Market
If HSAs Are So Great, Should Every American Be Eligible to Open One?
Many Americans aren't eligible to open and fund a Health Savings Account. Increasing the pool of people who are HSA-eligible should be a top priority of anyone who wants to help people manage the cost of medical care. Here are some approaches that will allow more Americans to open and fund an HSA.
Sign-Ups in Affordable Care Act Marketplaces Reach Record 14.5 Million
About 14.5 million Americans have signed up to get health coverage this year through Affordable Care Act insurance marketplaces, eclipsing the previous record enrollment by nearly 2 million. The tally is not quite final, so it probably will be higher in the end.
HSAs & Retirement
Why a Health Savings Account Is a Secret Weapon in Saving for Retirement
Federal employment has an extra perk hiding in plain sight, but it’s often overlooked. Contributions to HSAs are not taxed initially, grow tax free and can be used for out-of-pocket medical expenses while working as well as after retirement. They can also be used for non-medical expenses after age 65 without penalty. Here's how to save for both your retirement and future health care expenses through an HSA.
If I Could Only Max Out One Investment Account, It Would Be This One
There are many different kinds of retirement investment accounts out there, each with their own pros and cons. Unfortunately, many people can't afford to max out all of them each year, which can leave them with tough choices about where to put their investment dollars. To me, the choice is simple when it comes to which investment account to prioritize after maxing out a 401(k) match. Without question, it's an HSA.
Maximizing Your HSA
3 Ways to Make the Most of Your HSA
A health savings account can have a load of benefits for those with a qualifying high-deductible health insurance plan. Not only can it help you save on taxes, but it can double as an investment account. But if you want to get the most out of your HSA, make sure you're doing these three things.
3 Huge HSA Mistakes You Don't Want to Make
A health savings account is arguably one of the best places to stash retirement savings and money you plan to use for medical expenses. But like most tax-advantaged accounts, HSAs have a lot of rules, and you need to follow them if you want to avoid costly errors and government penalties. Here are three of the biggest HSA mistakes you don't want to make this year.
Not Eligible to Fund a Health Savings Account? What About Your Spouse?
It's important for HSA owners to know when they're not eligible that another family member may be able to step in and leverage the family's medical coverage to fund their own HSA. Couples that fail to understand their full range of options may lose $2,000 in tax savings annually as a result. That's an expensive price to pay for not understanding the rules.
When Should You Make an IRA-to-HSA Transfer?
Did you know that it is possible to make a tax-free transfer from an IRA to an HSA? Although not ideal for everyone, there could be situations where someone who has high medical costs but insufficient cash flow to cover them might benefit from this once-in-a-lifetime move, also known as a "qualified HSA funding distribution."