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2010 Indexed HSA Contribution Limits

2010 Indexed HSA Contribution Limits and Minimum Deductible/Maximum Out-of-Pocket Requirements for HSAs and HDHPs

The Treasury Department and Internal Revenue Service have released IRS Rev. Proc. 2009-29, under Internal Revenue Code section 223(g), which lists new indexed rates, adjusted for inflation, for Health Savings Accounts (HSAs) and qualified High Deductible Health Plans (HDHPs).

To whom do the new inflated rates apply?
The rates will apply to any employer offering an HSA and/or a qualified HDHP. The fact that a plan has high deductibles will not, in and of itself, make the plan a qualified HDHP. For a plan to be considered a qualified HDHP—in addition to other requirements—the plan must satisfy minimum deductible and maximum out-of-pocket requirements, as noted below.

What are the new inflated amounts?
For HSAs:
The annual HSA contribution limit is $3,050 for individual coverage and $6,150 for family coverage. Catch-up contributions continue to be allowed for HSA-eligible individuals age 55 and over. The annual catch-up contribution limit is $1,000.

For HDHPs:
For a plan to be considered a qualified HDHP in 2010, the minimum deductible cannot be less than $1,200 for an individual or $2,400 for a family. The maximum out-of-pocket cannot exceed $5,950 for an individual or $11,900 for a family.

When do these new inflated amounts go into effect?
The new inflated amounts apply to calendar years starting January 1, 2010.

How do these new inflated amounts impact employers?
Any employer that currently offers an HSA and/or an HDHP must amend its plan documents and marketing materials to reflect the new inflated amounts. An employer that is considering adding an HSA and/or an HDHP should build the plans keeping the above limits in mind.