HSA News for September 23, 2019
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
Lobbying War Stalls Congress’ Attempt to End 'Surprise Medical Bills'
President Donald Trump has said the practice of surprise billing “must end.” Both Republicans and Democrats in Congress back legislation that would do just that. However, as a result of a massive lobbying effort against the legislation, Congress may not deal with the problem at all — and if it does, it may not adopt what advocates consider the best approach.
Pelosi’s Drug Plan Would Let U.S. Negotiate Prices of 250 Medications
On September 19, House Speaker Nancy Pelosi released her long-awaited plan to curb soaring prices of prescription drugs, a political chess move that could prod the Senate to move and heat up congressional negotiations with the White House on a popular but elusive goal.
Trump Praises Rollout of Pelosi's Drug Pricing Bill After McConnell Rejects the Measure
President Trump praised the rollout of the drug plan by House Speaker Nancy Pelosi, tweeting that “it’s great to see Speaker Pelosi’s bill today. Let’s get it done in a bipartisan way!” He also said that he "very much" likes drug pricing legislation proposed by Senate Finance Committee Chairman Chuck Grassley (R-IA) and ranking member Ron Wyden (D-OR).
HSA Studies & Analysis
U.S. Companies Doubling Down on Financial Wellness Programs
Bank of America announced findings from its annual 2019 Workplace Benefits Report on September 19, revealing that 53% of companies today offer financial wellness programs today compared to just 24% back in 2015. However, the report found awareness and understanding of HSAs lacking.
HSAs Linked to Care Access in Cancer Survivors
Whether a cancer survivor had an HSA as part of their HDHP was linked to access to care, according to the results of a recently published study. The proportion of cancer survivors who delayed or skipped care was similar between those in HDHPs with an HSA and those in low-deductible health plans, indicating that having an HSA is linked to access to care.
HSA Compliance Corner
DOL Letter Addresses Status of Employer HSA Contributions Under Consumer Credit Protection Act
The U.S. Department of Labor’s Wage and Hour Division has issued an opinion letter that addresses how the wage garnishment provisions of the Consumer Credit Protection Act apply to employer contributions to employees’ HSAs. The letter responds to an inquiry asking whether such contributions are earnings under the Act.
Can We Allow Employees to Change Their Cafeteria Plan Elections During the Plan Year?
Employees’ elections under a cafeteria plan generally must be irrevocable and cannot be changed during the period of coverage. However, elections to make HSA contributions with pre-tax salary reductions under a cafeteria plan can be changed prospectively at any time.
HSA Industry Best Practices
5 Tips for Implementing a CDHP/HSA Solution Employees Will Use
For employers looking to implement a CDHP/HSA solution, education is essential to helping employees understand why they should enroll. Here are five simple tips to help implement an effective CDHP/HSA solution that employees will understand and get excited about.
The HSA Market
Hospital CEOs Wary of HDHPs
A few New Hampshire health care executives expressed doubts recently about the latest market-based effort to control health care costs -- the HDHP. One hospital executive said the plans can become a barrier to care. Another called the plans a blunt instrument but acknowledged her organization provides an HDHP to its 13,000 employees.
How Expanding HSAs Could Cure America’s Sick Health Care System
Congress should expand HSAs by applying the tax exclusion that exists for employer premium payments instead to HSA contributions; increase HSA contribution limits; let workers use these “large” HSA funds to buy coverage tax-free; and eliminate any requirement that HSA holders carry health insurance.
HSAs & Retirement
HSAs Are a Misunderstood Retirement Savings Tool. Here’s How to Use Them.
U.S. workers in HDHPs are embracing HSAs, but their value as a potential retirement-savings vehicle is still largely untapped and not understood. According to a new report, 57% of employees and 65% of employers believe they have a good understanding of HSAs, but only 11% and 7%, respectively, could name the four basic attributes of HSAs.
HSAs as a Retirement Planning Vehicle
Increasingly, HSAs are being viewed, accepted, and treated in the industry, as a long-term investment strategy, but there is still a huge gap in participant understanding that HSAs can have a long-term strategy. For instance, parents of Millennials don’t talk about HSAs.
55% of Older Workers Are Missing Out on This Key Savings Opportunity
Although future retirees aged 50 and over cite healthcare costs as their top retirement concern, only 55% of older workers who have the option to fund an HSA don't contribute to one, according to a recent survey. If you don't take advantage of this key savings opportunity, you'll likely regret it down the line.
58% of Older Adults Say They're "Terrified" of This Retirement Expense
In general, workers are most worried about running out of money in retirement, according to a report from the Transamerica Center for Retirement Studies. There's one overwhelming fear, though, that the majority of adults nearing retirement age say "terrifies" them: healthcare costs.
79% of Future Retirees Are Dangerously Ill-Informed About Medicare
79% of future retirees erroneously think that Medicare Part B is free to workers who pay Social Security taxes for at least 10 years. Not only is Medicare Part B not free, but it's also just one of many things you'll need to pay for under Medicare. And the sooner you read up on what costs to expect, the better you'll be able to plan for them.
Maximizing Your HSA
Try This if You Are Maxing Out Your 401(k)
If your health insurance plan includes them, you can consider using an HSA as an “extra” retirement plan. As with IRAs or 401(k) plans, any money you put into an HSA gives you an immediate tax deduction. And you can take cash out of an HSA at any time tax and penalty free if you use it to pay for qualifying medical expenses. But here’s where it gets fun. No one says you have to spend the money.
Funding an HSA With an IRA
Millions of Americans fund an HSA each year. But most people aren't aware of a rule that lets them fund an HSA with their individual retirement account. Although fairly limiting, the rule is a valuable way to deploy IRA funds.
52% of Older HSA Participants Are Making This Huge Mistake
An estimated 52% of future retirees aged 50 and over who contribute to an HSA only use it for current healthcare expense. And that's a mistake they're likely to regret in the long run. When you don't use up that money from year to year, you can invest your remaining dollars and grow your balance into a larger sum. That way, you'll have a dedicated savings account you can tap for medical costs in retirement.
Benefits of HSAs for Those With Chronic Illnesses
High-deductible health insurance plans with HSAs could become more attractive to people with chronic illnesses. This summer, the IRS added 14 treatments and services for a range of chronic health conditions to the list of items that insurers may provide as preventive-care benefits. People with the named conditions may now be able to receive certain treatments at no cost or at a lower cost.
HSA Wednesday Wisdom: Cheryl’s She-Shed, He Said
Cheryl's She-Shed succumbed to flames. Can she rebuild using her HSA balances? The quick answer is of course not. And that’s the best default answer. But a deeper examination shows how Cheryl may be able to use the flexibility of her HSA to help her move forward in life.
Consumer-Driven Health Care
Young Adults Take “Risky” Actions to Save on Health Care Costs
Many young adults avoid important care now in order to avoid the expense. Almost three in four younger adults have taken “risky” actions to save money on medical-related expenses, including delaying seeking medical help, hoping the condition will subside and not seeking care to avoid high deductibles.
Walmart’s First Healthcare Services ‘Super Center’ Opens
On September 13, Walmart opened its first 10,000 square-foot “Walmart Health” center in Dallas, Georgia that features an array of primary medical services, dental care, and behavioral health services as part of a new model expected to eventually be replicated in other markets.