Benefits Buzz

Industry Update: New HSA Limits, Medicare SEP & ERISA Notification News

Posted on May 27th, 2020

The regulatory agencies have been busy issuing guidance these last several weeks. Here are some important updates in case you missed them:

Health Savings Accounts (HSAs)

The Internal Revenue Service (IRS) recently issued Rev. Proc. 2020-32 with the 2021 limits for HSAs. The maximum contribution for a person with self -only coverage will be $3,600 (an increase of $50), and the maximum contribution for a person with family coverage will be $7,200 (an increase of $100). The catch-up contribution for people ages 55 or over remains at $1,000.

The minimum deductible for a qualified high deductible health plan (HDHP) remains unchanged in 2021. It will stay at $1,400 for a person with self-only coverage and $2,800 for a person with family coverage. The maximum out-of-pocket limit will adjust upwards to $7,000 (an increase of $100) for a person with self-only coverage and $14,000 (an increase of $200) for a person with family coverage. Please note the HDHP limits for plans that are HSA-eligible have lower out-of-pocket limits than what the Affordable Care Act (ACA) allows.

Medicare Special Enrollment Period (SEP)

The Centers for Medicare & Medicaid Services (CMS) recently announced an SEP is available until June 30, 2020 for Medicare Advantage and Part D members who were unable to make an election or an election change during a valid enrollment period because of COVID-19. In a separate announcement, CMS is providing additional time for a person to enroll in Part B. The deadline for this year has been extended to June 17, 2020 (it is normally March 31st). The deadline also applies to those individuals who need pay a premium for Part A.

Employee Retirement Income Security Act (ERISA) Notices

The Employee Benefit Security Administrator (EBSA) recently issued Disaster Relief Notice 2020-01 extending the deadline for providing various notices, disclosures and other documents that are required by ERISA. The guidance says, “An employee benefit plan and the responsible plan fiduciary will not be in violation of ERISA for a failure to timely furnish a notice, disclosure, or document that must be furnished between March 1, 2020, and 60 days after the announced end of the COVID-19 National Emergency, if the plan and responsible fiduciary act in good faith and furnish the notice, disclosure, or document as soon as administratively practicable under the circumstances.” Good faith acts include use of electronic alternative means of communicating with plan participants and beneficiaries who the plan fiduciary reasonably believes have effective access to electronic means of communication, including email, text messages, and continuous access websites.

 

Have a question about any of these changes?

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