The IRS announced the inflation-adjusted increases for thresholds applicable to HSAs and high-deductible health plans (HDHPs) for 2014 in Revenue Procedure 2013-25 last week.
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Here are the 2014 limits:
- The maximum annual HSA contribution for self-only HDHP coverage will increase from $3,250 to $3,300. The maximum annual HSA family contribution for HDHP coverage will increase from $6,450 to $6,550.
- Age 55 catch-up contributions will continue to be $1,000.
- The minimum HDHP deductible limits will remain the same: self-only coverage is $1,250 and family coverage is $2,500.
- The annual maximum for HDHP out-of-pocket expenses (deductibles, co-payments and other amounts) will increase from $6,250 to $6,350 for self-only coverage and from $12,500 to $12,700 for family coverage.
These limits are effective for the calendar year 2014. For HDHPs with non-calendar plan years, the minimum deductible and out-of-pocket limits are those that in effect on the first day of the plan year, per Notice 2004-50, Q/A-86.
A high-deductible health plan (HDHP) is a health plan that meets the the statutory requirements for minimum annual deductibles and maximum out-of-pocket expenses according to the IRS code. A plan like this is designed for consumers who wish to have more control over how they spend their health care dollars. For example, when purchasing a HDHP, consumers generally pay lower premiums but have higher out-of-pocket costs that count towards the deductible when care is sought. A health savings account (HSA) is a funding vehicle for a HDHP. It is a tax-advantaged medical savings account that helps participants in a qualified HDHP save money for medical expenses.
If you are interested in a qualified high-deductible health plan and health savings account, contact Lauren Simonetti at (248) 594-5550.
Source: IRS 2014 HSA Limits
