HSA News for October 23, 2023
HSA news is compiled by Mr. HSA, Roy Ramthun.
News from Washington
IRS Postpones Tax-Filing and Tax-Payment Deadline to November 16 for California Storm Victims
On October 16, the IRS further postponed tax deadlines for most California taxpayers. In the wake of last winter's natural disasters, the normal spring due dates had previously been postponed to October 16. As a result, eligible individuals will now have until November 16 to file their 2022 returns, pay any tax due, and make 2022 contributions to IRAs and HSAs.
Acting Secretary of Labor Su Clarifies Aim of New Fiduciary Proposal
The Department of Labor continues to attempt to clarify when advisers providing investment advice for a fee are ERISA fiduciaries, according to information the department provided to a committee of the House of Representatives. “Our concern consistently has been and continues to be with financial arrangements that can present conflicts of interest” for advisers in the retirement space, according to Labor's written responses to questions from the committee.
OMB Begins Holding Stakeholder Meetings for New Fiduciary Rule
The White House Office of Management & Budget has begun holding meetings with stakeholders to discuss the Labor Department's fiduciary rule proposal, though a draft is not being made available. OMB typically takes between 60 and 90 days to review a proposal. Industry representatives hope a published proposal will be released for comment between November 7 and December 7.
HSA Studies & Analysis
Americans Still Largely Unaware of HSA Benefits
There is a glaring gap when it comes to awareness of Health Savings Accounts according to data from Fidelity Investments, with half of Americans unfamiliar with HSAs and their triple-tax advantage. Many think HSAs have a “use-it-or-lose-it rule." The Fidelity study findings build on other recent studies showing many Americans lack awareness and understanding about HSAs.
HSA Compliance Corner
Can Your Child's Coverage Affect Your HSA Eligibility? No.
HSA eligibility can be tricky. And no issue is trickier than a family member's eligibility when an employee participates in her company's general Health FSA program. But although spouses can disqualify each other, and a parent can disqualify an adult child, a child can't disqualify a parent.
Have You Received Your Rx Creditable Coverage Letter?
If you're age 65 or older and covered on a group medical plan, you should receive a letter from your plan sponsor telling you whether your prescription drug benefit meets Medicare's requirements. If you want to continue to fund your HSA, you must defer enrollment in any Part of Medicare. But those who delay enrollment in Part D must also have private coverage that's as rich as Medicare Part D or they could be subject to a lifetime penalty.
HSA Industry News
Lincoln Financial Group Introduces Comprehensive Health Savings Solutions for Plan Sponsors
Lincoln Financial Group announced the launch of an expanded suite of health savings solutions designed to empower retirement plan sponsors with a holistic approach to employee financial wellness. The comprehensive offering now includes a fully integrated HSA that serves as a tax-efficient tool to manage qualified medical expenses, achieve savings and pursue retirement readiness.
HSA Best Practices
How HSAs Can Bridge the Health & Wealth Gap: Start Educating Employees Now
A recent report from Voya Financial underscores the valuable role that HSAs can play as a supplement to a retirement savings plan. But a majority of employees do not fully understand how HSAs work, and as a result do not know how to use those benefits effectively. Employees need their employers to educate them about HSAs and help them make benefits decisions.
Entry-Level Employees or Pre-Retirees? The Right HSA Messaging Is Key
With open enrollment season in full swing, many employers see this time as a great opportunity to help their employees understand the full potential of their HSAs; however, your employees’ financial needs differ considerably depending on the stage of work they’re in. Here, are tips for communicating the value of HSAs to these two groups at very different stages of work.
Market Trends
Health Insurance Premiums Now Cost $24,000 a Year, Survey Says
The average employer-sponsored health insurance premium for U.S. families rose 7% to almost $24,000 this year compared with a 1% increase least year, according to an annual survey of more than 2,000 US companies. Rising premiums are adding to the burden on employers and workers as inflation erodes broader buying power.
HSAs & Retirement
Maxed Out Your IRA? Keep Saving for Retirement With This Underrated Account if You Can
Traditional retirement accounts, like 401(k)s and IRAs, are most people's first choice for retirement savings. But an HSA is also a great place to stash your savings. HSAs are primarily intended to hold medical savings, but they can also serve as retirement accounts, thanks to their triple tax advantage.
The Best Ways to Build Wealth When You’re 10 Years from Retirement
If you’re about a decade away from your goal retirement age but your savings are not where you want them to be, don’t panic. There are still opportunities for you to build up your nest egg over the next 10 years. These are the best moves to make to build wealth when you’re 10 years from retirement. For example, any money you put into HSAs now can be used during your retirement.
Here's a Good Reason to Delay Your Medicare Enrollment
If you're someone who's in the habit of funding an HSA and you're still covered by a group health plan at age 65, you may not want to rush to sign up for Medicare. If you do, you'll have to stop making HSA contributions immediately. The more money you're able to put into your HSA, the easier it should be to cover your healthcare expenses once your career finally comes to an end.
Maximizing Your HSA
Should You Contribute to an HSA in 2024?
If you're someone who doesn't tend to spend a lot on healthcare expenses, then you may be inclined to forgo an HSA next year. But that could be a huge mistake because you don't have to take HSA withdrawals the year you make contributions. Even if you don't have a near-term need to cover your medical expenses, you might really appreciate that savings once you're retired.
Open Enrollment: Here's Why You May Want to Choose a High-Deductible Health Plan for 2024
October and November are when workplace open enrollment periods commonly kick off. One big decision you'll have to make is signing up for a health insurance plan. If you are looking at premiums that are higher than you want to pay, that's one reason to consider a high-deductible plan. Another good reason is that you may be eligible to participate in an HSA.
Time to Rethink Your Healthcare Coverage
A few years ago, my employer introduced some modeling tools so we could compare the overall cost of the various health insurance options. In every scenario I modeled, the high deductible plan had lower overall out-of-pocket costs. Even better, the high deductible plan qualified me for an HSA, and my employer will make an annual contribution to it as well. An HSA is one of the most powerful tax-advantaged savings accounts you will ever encounter.
Don't Miss Out on FSA or HSA Savings
It’s the season to enroll in FSAs and HSAs. But if you fail to sign up during your employer’s open enrollment period, you could miss out on thousands of dollars in savings. You can use the accounts to cover qualified expenses including occasional medical costs like co-pays, lab fees and x-rays or everyday items like first aid supplies and contact lenses.
Consumer-Driven Health Care
GoodRx, Sanofi to Offer Insulin for $35, Regardless of Insurance, at Select Pharmacies
GoodRx is teaming up with Sanofi to offer consumers access to its most prescribed insulin, Lantus, for $35 at any pharmacy that accepts GoodRx, including CVS, Walgreens, and Walmart. All Americans with a valid prescription, regardless of their insurance status, can use GoodRx to access a 30-day supply of Lantus for $35. Patients can access the coupon GoodRx.com.
In Healthcare, Why Cost and Quality Don't Match Up
Everything you think you know about healthcare price and quality is probably wrong. Although it's counterintuitive, price and quality in healthcare usually have an inverse correlation (i.e., higher quality means lower price; higher price means lower quality). Want to pay less for healthcare? Then look for the highest quality care. Simply put, quality costs less.