The U.S. Internal Revenue Services (IRS) announced that beginning 2010, the limits for health savings accounts (HSA) and high deductible health plan (HDHP) contributions have been increased. The IRS releases these limits by June 1st of the year before they apply in order to allow plan administrators, employers and employees ample time to make changes. These new limits reflect increases in the cost of living.

Health savings accounts were created under the Medicare Modernization Act in 2004. This legislation allows individuals or employers to contribute to an HSA as long as the individual is participating in an HDHP. According to a RECENT STUDY done by America’s Health Insurance Plans (AHIP), over 8 million Americans are covered by HDHPs with HSAs.

HOW DOES THIS AFFECT YOU AS AN EMPLOYER?

The new 2010 HSAs & HDHPs contributions are as follows:

Maximum Annual HSA Contribution:
Individual Coverage: $3,050 (up $50 from $3,000 in 2009)
Family Coverage: $6,150 (up $200 from $5,950 in 2009)

Minimum HDHP Deductible:
Individual Coverage: $1,200 (up $50 from $1,150 in 2009)
Family Coverage: $2,400 (up $100 from $2,300 in 2009)

Maximum HDHP Deductible:
Individual Coverage: None
Family Coverage: None

Maximum HDHP Out-of-Pocket Expense:
Individual Coverage: $5,950 (up $150 from $5,800 in 2009)
Family Coverage: $11,900 (up $300 from $11,600 in 2009)
* Out-of-pocket expense does not include premiums

WHAT SHOULD I DO NEXT?
Please consult with your tax or legal professional regarding Revenue Procedure 2009-29; to access this document please CLICK HERE.

If you have any additional questions regarding the information within this eCommunication, please call Corporate Synergies at 1.866.CSG.1719 or click here to contact us today.

This alert is a legislative update designed to help you administer your employee benefits program and is not legal counsel. Please consult with an attorney for legal advice.