HSA News for February 7, 2022
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
HSA Compliance Corner
Is Telehealth Now Disqualifying for HSA Contributors? Not Necessarily!
Your insurer should have adjusted its schedule of benefits and its claims system to charge a price for virtual care and apply that price to the deductible on all plans that renew January 1, 2022 or later. Be sure to check with your insurer so that you don't lose your eligibility to open and fund a Health Savings Account because the insurer didn't update your coverage.
IRS Releases 2021 Form 8889 and Instructions for HSA Reporting
The IRS has released the 2021 version of Form 8889 and its instructions. HSA owners must attach Form 8889 to their tax returns to report tax-related events affecting their HSAs. The 2021 versions are substantially similar to 2020 but have been updated to reflect the 2021 HSA and HDHP limits and thresholds and the deadline for making HSA contributions for 2021.
HSAs & Retirement
Here Are Three Approaches to Allow Seniors to Contribute to an HSA
The issues at the intersection of Medicare and HSAs are particularly disturbing because they disproportionately affect seniors who remain in the work force and collect Social Security benefits to make ends meet or work at a small company that values their contribution. There are three distinct approaches that Congress can take to extend the benefits of HSAs to seniors, whether working or retired.
Are Target Date Funds a Good Fit for HSAs?
Target date funds have been growing in popularity over the past couple decades, due in part to their use in employer-sponsored retirement plans. But do target date funds make sense as investment options for savings vehicles such as HSAs, where participant usage can vary widely from that of 401(k)s? Electing a default investment option in HSA plans is not as black and white as it seems to be for 401(k)s.
Medicare Costs Are Rising. Here's How to Prepare
Medical care is a burden for many seniors, and that extends to those who are relatively healthy. If you want to avoid a financial crunch later in life, it pays to read up on Medicare to see what costs you may be in line for. At the same time, it's a good idea to have income available outside of Social Security to make those costs more manageable, and to take advantage of a health savings account if you qualify.
Maximizing Your HSA
The Triple Tax Break You Do Not Want to Overlook
Healthcare costs and taxes are two important concerns for most people, especially as they approach retirement. Fortunately, there is one account that may be the most valuable: the HSA. When people think of the HSA, seldom do they think of retirement savings. Often it is used instead as a source of funds for current health care costs. This can lead to a significant missed opportunity.
Here's the Best Way to Benefit From Your HSA
There's a reason health savings accounts are often hailed as a terrific retirement-savings tool. Even though HSAs aren't meant for retirement specifically, they can serve as a savings plan for your senior years -- if you manage yours wisely. It's a good idea to leave your HSA alone as long as possible, rather than take withdrawals for healthcare costs during your working years.
How to Invest With Your HSA
More and more people are using Health Savings Accounts to help save for future medical expenses or even give a boost to their retirement funds. These savings accounts come with many benefits, including the opportunity to invest and grow your funds tax-free. Here are tips for how to invest your HSA and some other things you should know about these increasingly popular savings vehicles.
Consumer-Driven Health Care
IRS Issues 2021 Versions of Publications 502 and 503 for Medical and Dependent Care Expenses
The IRS has released updated versions of Publications 502 and 503 for the 2021 tax year. Publication 502 describes the medical expenses that are deductible by taxpayers on their 2021 federal income tax returns. Publication 503 explains the requirements that taxpayers must meet to claim the dependent care tax credit for child and dependent care expenses.
Hospitals’ Cash Prices for Services Offer a New Look at Health Care Pricing
As some health policy analysts already suspected, hospital prices available to individuals willing to pay cash can be lower than those negotiated by insurers. Based on data I collected for select medical services amenable to shopping, the cash prices reported by hospitals is lower than the highest insurer-negotiated price 87% of the time; lower than most major insurers’ negotiated prices 55% of the time; and lower than even the lowest insurer-negotiated price 43% of the time.