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May 5, 2015 – The IRS released the 2016 cost-of-living adjustment amounts for health savings accounts (HSAs) in Revenue Procedure 2015-30. Adjustments have been made to the HSA contribution limit for individuals with family high deductible health plan (HDHP) coverage and to some of the deductible and out-of-pocket limitations for HSA-compatible HDHPs.

The HSA contribution limit for an individual with self-only HDHP coverage remains at $3,350 for 2016. The 2016 contribution limit for an individual with family coverage is increased to $6,750. These limits do not include the additional annual $1,000 catch-up contribution amount for individuals age 55 and older, which is not subject to cost-of-living adjustments.

HSA-compatible HDHPs are defined by certain minimum deductible amounts and maximum out-of-pocket expense amounts. The HDHP limits for 2016 are also found in Revenue Procedure 2015-30. For HDHP self-only coverage, the minimum deductible amount is unchanged for 2016 and cannot be less than $1,300. The 2016 maximum out-of-pocket expense amount for self-only coverage is increased to $6,550. For 2016 family coverage, the minimum deductible amount is unchanged at $2,600 and the out-of-expense amount increases to $13,100.

The following table highlights the 2015 and 2016 limitations.

HSA Annual Contribution Limit* HDHP Minimum Annual Deductible HDHP Maximum Out-of-Pocket Expense
2015 $3,350 self-only

$6,650 family

$1,300 self-only

$2,600 family

$6,450 self-only

$12,900 family

2016 $3,350 self-only

$6,750 family

$1,300 self-only

$2,600 family

$6,550 self-only

$13,100 family

*Plus $1,000 per year if age 55 or older

 

Small Businesses Score Big on Employee Benefits Satisfaction
“Nine in ten responding small employers provide health care coverage and three in four provide a retirement plan. Yet, compared with larger corporations, not surprisingly, small employers were less likely to offer a wide variety of other benefits … [The authors] asked employers to subjectively rate their employees’ engagement and benefits satisfaction…. [R]atings came back just as high for small employers as they did for their larger peers.” (International Foundation of Employee Benefit Plans [IFEBP])

 

The Unfunded ACA Risk Corridor May Make the U.S. Insurance Market Less Stable, Not More
“[The authors] expect the ACA risk-corridor pool to be significantly underfunded for 2014 if its funding is limited only to insurers’ risk corridor payments. [This] risk-corridor study found that the aggregate risk-corridor payables recorded by U.S. insurers for 2014 are less than 10% of the aggregate risk-corridor receivables booked by insurers for the same year. Uncertainty of payment due to underfunding can cause volatility in the market for all participants.” (Standard & Poor’s Financial Services LLC)