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A summary of the articles included in the September 2022 edition:
- Budget Package Includes Insulin Help for HSA Users
- Can Your Company Inadvertently Disqualify You from an HSA? Yes!
- Health Insurance ‘Knowledge Gap’ Is Wide as Open Enrollment Approaches
- 2022 Draft Instructions for Form 8889 Highlight Legislative Changes
- Recession Resistant Benefits: How HSAs Can Help
- Congressional Research Services: Health Savings Accounts (HSAs)
Budget Package Includes Insulin Help for HSA Users
The Inflation Reduction Act budget package — H.R. 5376 — could help clients with diabetes who want to use health savings accounts.
Today, HSA users must combine their accounts with high-deductible health insurance policies that meet HSA program requirements. For a client who uses insulin to control diabetes, that could mean using most or all of the cash contributed to the HSA to pay for insulin.
H.R. 5376 would let an HSA-compatible health insurance policy cover insulin before the patient has met the policy deductible.
The HSA insulin provision appears in Section 11408, on page 238 of the PDF file version of the package now posted on the House Rules Committee website.
Can Your Company Inadvertently Disqualify You from an HSA? Yes!
Employers who offer a Health Savings Account don’t mean to disqualify employees from opening and funding accounts. But sometimes they do.
At a high level, Health Savings Account eligibility isn’t difficult:
- You can’t qualify as anyone’s tax dependent.
- You must be covered by an HSA-qualified plan.
- You can’t have any disqualifying coverage.
Simple, except that it isn’t. Some plans that look like they’re HSA-qualified aren’t. And some workplace programs and services that don’t look like coverage are defined that way under federal tax law and may be disqualifying.
Let’s look at some common situations that may disqualify employees from opening and funding a Health Savings Account.
Health Insurance ‘Knowledge Gap’ Is Wide as Open Enrollment Approaches
Many workers in the U.S. misunderstand basic facts about health insurance and remain unsure how to select the most appropriate health plan offered by their employer during annual open enrollment, new research shows. As a result, they—and their employers—may be spending more than they should on health coverage.
Confusion remains high around key terms such as “deductible” and “co-pay,” while the workings of health savings accounts (HSAs) and flexible spending accounts (FSAs) are often a mystery.
A lack of understanding about health benefits can lead to uncertainty and stress during open enrollment, according to HR software firm Justworks’ Health Insurance Knowledge Snapshot, based on a June 9-13 survey among 1,040 U.S. adults employed full or part time.
2022 Draft Instructions for Form 8889 Highlight Legislative Changes
The IRS released draft instructions for Form 8889, Health Savings Accounts (HSAs), for the 2022 tax year to reflect several important legislative changes. They include:
- The extension of safe harbor and disregarded coverage for telehealth and other remote care services; and
- No surprise billing for emergency or air ambulance services.
Recession Resistant Benefits: How HSAs Can Help
In one way or another, we are all bracing for a recession after two consecutive quarters of decline in economic activity. While the impact of a recession can be far-reaching, for those with and supporting health savings accounts (HSAs), there might be a glimmer of hope. Let’s see how HSAs provide a recession-resistant benefits approach for individuals, employers and brokers/consultants.
Congressional Research Services: Health Savings Accounts (HSAs)
The Congressional Research Service (CRS) has released an updated assessment on health savings accounts (HSAs).
The report summarizes the principal rules governing HSAs, covering such matters as eligibility, qualifying health insurance, contributions, withdrawals, and tax advantages. It incorporates changes made to HSAs as a result of the Coronavirus Disease 2019 (COVID-19) pandemic and corresponding recession. It concludes with a discussion of HSA data limitations and recent trends in HDHP enrollment and HSA utilization.