HSA News for April 22, 2024
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Don't Finalize Fiduciary Rule Now, Groups Urge DOL
Industry trade groups are pressing the Labor Department to continue to receive public input on its fiduciary rule and not “finalize the rule now.” In a letter sent April 15, 11 trade groups asked Labor and OMB to continue the public input process. The letter cites concerns around “significant rulemaking flaws in the regulatory process" at the agencies.
HSA Studies & Analysis
What Will It Take to Achieve a Trillion-dollar HSA Asset Base?
A speaker at a recent conference asked an audience of about a dozen industry insiders whether they believed that HSAs would become a trillion-dollar industry. All hands went up. Is that goal achievable? Desirable? Here are the levers that can be pulled to increase HSA assets to $1 trillion.
HSA Enrollees Use Health Care Services Differently Than Those With PPOs, Research Shows
Employees enrolled in HSAs use health care services differently than those with a preferred provider plan, according to new research. The Employee Benefit Research Institute found that HSA enrollees typically make less use of emergency departments, specialists, outpatient services, and prescription drugs (for those with no health conditions) but higher use of inpatient services and primary care (for those with two or more conditions) relative to PPO enrollees.
HSA Compliance Corner
7 Things to Know About HSA Compliance
HSAs offer an excellent opportunity for participants to save money on healthcare expenses. But there are HSA rules and regulations you and your employees need to follow in order to stay compliant. Keep reading to learn more about HSA compliance topics including: rules for employees, designing an HSA program, and how to keep HSAs exempt from ERISA.
Industry News
Devenir Unveils New HSA Balance Projection Calculator
Devenir announced the release of a new HSA Balance Projection Calculator which can project the HSA deposit account, investment account, and combined balances over a specified number of years, presented as both a visualization and exportable table. The calculator also demonstrates the power of HSAs by projecting the potential federal tax savings over time.
Ascensus Pens Deal for Vanguard’s Small Plan Recordkeeping Division
Ascensus plans to acquire the recordkeeping business for Vanguard’s Individual 401(k), Multiple Participant SEP and SIMPLE IRA Plans division. Ascensus will take on the responsibilities of recordkeeping and client servicing for Vanguard’s existing SIMPLE, Multi-SEP and individual 401(k) retirement plans, thereby expanding its total retirement plans managed to nearly 280,000.
HSA Best Practices
HSAs: Holistic Education and Targeted Outreach
HSAs can be complicated for participants, but advisers and plan sponsors can combat that confusion with holistic education and access to informational resources, according to panelists speaking at a recent conference. For plan sponsors, it’s important to pay attention to spending across the health and retirement plan when strategizing. If positioned correctly, the components can then be adjusted annually based on the feedback and needs of the employees.
Medical Account Alphabet Soup
Employers should determine the company’s objectives before selecting health benefits to offer employees, according to panelists who spoke at a recent conference. For sponsors, selecting health benefits to offer employees from the various medical account offerings (e.g., HSAs, FSAs, HRAs) depends on what the employer is trying to achieve and their employee population.
HSAs & Retirement
HSAs As 'Medical IRAs': A Great But Neglected Strategy
Roth IRAs have caught on as weapons in Americans’ wealth-building arsenal. But the “medical IRA” strategy of using triple-tax-free Health Savings Accounts to fund medical expenses in retirement hasn’t caught on. Does the financial advice industry bear some of the responsibility?
American Adults Show Lack of ‘Retirement Fluency’
Poor financial decisions often correlate with low levels of financial literacy, so it is a cause for concern that U.S. adults consistently struggle to understand retirement-related topics, according to the 2024 TIAA Institute-GFLEC Personal Finance Index. On average, U.S. adults correctly answered only 48% of the 28 financial literacy questions, and this figure has hovered around the 50% mark since the inaugural survey in 2017.
Maximizing Your HSA
Some Medical Travel Qualifies for Tax-free HSA Distributions
I’m traveling with my young son for his care in another state. Can I reimburse our travel expenses tax-free from my Health Savings Account? Yes, you can reimburse certain travel expenses (such as transportation, lodging, and meals) tax-free from your HSA if the primary purpose of the trip is to receive medical care. But not all expenses count.
Consumer-Driven Health Care
How to Save Money at the Pharmacy Counter
Prescription drugs have been the highest-growing category of expense for several years, according to Mercer, and the rate in 2023 pushed up even higher to 8.4% in part because of the growing popularity of drugs for diabetes and weight loss, known as GLP-1s (a popular one is Ozempic). Here's what you need to know about how to save money at the pharmacy counter.