Weekly HSA News – August 8, 2022

News from Washington
Senate Passes Sweeping Tax, Climate Package After Marathon Vote; Harris Breaks Tie
Senate Democrats have passed their sweeping tax, health care and climate change legislation after a marathon night of voting, with Vice President Harris casting the decisive vote to break a 50-50 deadlock and send the package to the House. The long-awaited $740 billion bill would raise taxes on corporations, tackle climate change, lower prescription drug costs and reduce the deficit.   Read More
Democrats Fail to Overrule Parliamentarian on Insulin Price Cap as GOP Votes No
Senate Democrats fell short of an effort Sunday to overrule a decision by the parliamentarian that effectively struck down a proposal sponsored by Sen. Raphael Warnock (D-GA) to cap out-of-pocket insulin costs at $35 a month for people not covered by Medicare. Sen. Lindsey Graham (R-SC), the ranking member of the Budget Committee, sought to enforce the parliamentarian’s ruling.   Read More
US Declares Public Health Emergency Over Monkeypox Outbreak
The federal government declared a public health emergency to bolster the response to the monkeypox outbreak that has infected more than 7,100 Americans.  The announcement will free up money and other resources to fight the virus, which may cause fever, body aches, chills, fatigue and pimple-like bumps on many parts of the body. Read More
HSA Compliance Corner
Kid’s No Longer Your Tax Dependent? HSA Reimbursement Rules Change!
When the day arrives that you’re no longer providing half or more of the child’s support, some new HSA rules apply. Be sure you understand how your child’s change in tax status – from your tax dependent to independence – affects your (and your child’s potential) HSA. HSA compliance rules change when a child no longer qualifies as your tax dependent.   Read More
HSA Industry Best Practices
Here’s How to Help Your Employees Make the Most of Their HSA
HSAs can be a powerful financial tool to promote employee retention and satisfaction since it can be invested in the market. While HSAs are useful for covering short-term needs, it’s important employees recognize they’re also great tools to prepare for future medical expenses. An HSA can be paired with other retirement accounts to maximize after-tax retirement income.   Read More
The Negative Spiral of High-Deductible Plans
High-deductible plans are a popular choice among employers because they can offer employees an affordable premium. Unfortunately, members who do not seek treatment for health conditions, or those not taking required medication, will inevitably drive the cost of the health insurance plan up, creating a spiraling cycle. Fortunately, options such as HSAs and FSAs can help.   Read More
HSAs & Retirement
These 3 Retirement Accounts Can Be Your Hero, Baby
There’s a concept in retirement planning called tax diversification. There are several different retirement accounts you may be able to use, and each has its own unique tax treatments and withdrawal rules. Using just three retirement savings accounts — a traditional 401(k), a Roth IRA, and a health savings account — can provide a very flexible set of assets in retirement.   Read More
A Medicare Surcharge That Might Surprise You If You’re Not Careful – IRMAA
For those who are getting closer to Medicare eligibility (age 65 for most people), it’s worth your while to pay attention to the potential income-related monthly adjustment amount (IRMAA)—one of those unwelcome surprises that can confront you as you near retirement or are in its early stages. For Medicare beneficiaries who earned over $91,000 two years prior, it’s a premium surcharge for Part B and Part D.   Read More
Maximizing Your HSA
This Chart Shows How Contributing to an HSA Can Pay Off Big
While most people think of Health Savings Accounts as tools for covering annual medical expenses, they can also be valuable retirement savings vehicles. HSAs are unique because they benefit from a trio of tax advantages. To understand the extent to which an HSA can be an effective way to cover health care costs in retirement, we sought to explore the results of three different approaches to this savings vehicle.   Read More
“No Taxes on Contributions.”​ But What About Those Federal Payroll Taxes?
The income-tax consequences of contributing to an HSA are identical to other tax-deferred accounts. But more important, employees who fund their HSAs through pre-tax payroll deductions through their company’s Cafeteria Plan don’t pay the federal payroll tax. Thus, they receive an automatic return (7.65% for most) on their money. That may not seem like much but it all adds up over time.   Read More
Invest in Your HSA Today
Saving enough for retirement is a big issue for many Americans. As such, using all the tools available to savers is very advantageous. And one of the best and perhaps most underutilized is the Health Savings Account. Thanks to its variety of tax benefits, HSAs offer a unique way for investors to save for retirement. The problem is they are often used incorrectly by investors.   Read More
Becoming an HSA Millionaire: Is It Possible?
HSAs allow annual contributions that are much lower than traditional retirement plans. Because HSAs have less restrictive withdrawal rules, allowing distributions for a broad array of “qualified medical expenses,” it’s more difficult for funds in an HSA to experience the benefits of uninterrupted compounding. Nonetheless, it’s not impossible to accumulate $1 million in an HSA.   Read More
Consumer-Driven Health Care
CVS Says It Plans to Get into Primary Care by Year-End
CVS said that it plans to acquire or take a stake in a primary-care company by the end of the year, as competition heats up with Amazon and Walgreens. CVS, best known for its many drugstores, doesn’t yet have doctor offices where patients can go for an annual checkup or appointments with a physician or nurse practitioner. CVS’ CEO says it wants to change that by buying or partnering with a company.   Read More
Health Care Consumers Plagued by Inaccurate Procedure Estimates
U.S. health care consumers continue to struggle paying for medical care, even when they have received a cost estimate for a procedure in advance. Oftentimes, that estimate is either unexpectedly high, or flat-out inaccurate. And generally, the estimates are inaccurate on the low side. A new survey offered more proof that this remains a barrier to consumer trust of the health care system.   Read More