The 2020 health savings account (HSA) and high deductible health plan (HDHP) limits have been announced. Earlier this week, the IRS released Rev. Proc. 2019-25, which provides the 2020 inflation adjusted amounts:
Maximum HSA Contribution
The maximum contribution will increase to $3,550 for individuals with self-only coverage, and to $7,100 for individuals with family coverage for 2020. This is up from the 2019 maximum contribution limits of $3,500 and $7,000, respectively. The additional HSA catch-up contribution of $1,000 for individuals age 55 or older is unchanged.
Minimum HDHP Deductible
The minimum deductible for an HSA-compatible HDHP will increase for plan years beginning in 2020 to $1,400 for self-only coverage and to $2,800 for family coverage. The current minimum deductible amount is $1,350 for self-only coverage and $2,700 for family coverage.
Maximum HDHP Out-of-Pocket Expense
The maximum participant cost share, not including premiums, will increase to $6,900 for self-only coverage and $13,800 for family coverage for plan years beginning in 2020. The 2019 limits are $6,750 for self-only coverage and $13,500 for family coverage.
The above limitations apply to HSA-compatible, or qualified, high deductible health plans. Health plans that are not paired with an HSA are not subject to these limitations. However, all non-grandfathered group health plans must comply with the Affordable Care Act (ACA) maximum out-of-pocket limits. These limits were released last month for 2020 plan years: $8,150 for self-only coverage and $16,300 for family coverage.
The above information does not constitute advice. Always contact your employee benefits broker or trusted adviser for insurance-related questions.