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July 2019: 2020 Inflation-adjusted Limits for HSAs and HDHPs

Business Insurance

 

IRS Releases Inflation-adjusted Limits for HSAs and HDHPs for 2020

On May 28, 2019, the IRS released Revenue Procedure 2019-25 to announce the inflation-adjusted limits for health savings accounts (HSAs) and high deductible health plans (HDHPs) for 2020. These limits include: 
  • The maximum HSA contribution limit
  • The minimum deductible amount for HDHPs
  • The maximum out-of-pocket expense limit for HDHPs
These limits vary based on whether an individual has self-only or family coverage under an HDHP.

HSA Contribution Limits for 2020
The IRS limits for HSA contributions increase for 2020. Eligible individuals with self-only HDHP coverage will be able to contribute up to $3,550 for 2020, while eligible individuals with family HDHP coverage will be able to contribute up to $7,100 for 2020. The $1,000 catch-up contribution limit that applies to HSA-eligible individuals who are age 55 or older will remain unchanged.

HDHP Cost-sharing Limits for 2020
For self-only coverage in 2020, the HDHP minimum deductible will increase to $1,400 and the out-of-pocket maximum will increase to $6,900. For family coverage, these limits will increase to $2,800 and $13,800, respectively.

Action Steps
Because these limits change for 2020, employers that sponsor these plans may need to make plan design changes for plan years beginning in 2020.
 
 
 

Additional articles from the July 2019 edition of the Univest Employee Benefits Newsletter:

  1. Don’t Forget About PCORI Fees
  2. Making Emotional Intelligence Work for You
  3. HR Action Steps for Employee Name Changes

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