As the Hays Research and Compliance team plans ahead, we want to inform our clients that there will be two plan design changes to consider for 2018:
- Affordable Care Act out-of-pocket maximum dollar limits, and,
- High Deductible Health Plan limits.
Affordable Care Act Out-Of-Pocket Maximum Dollar Limits
Last December, the U.S. Department of Health and Human Services (HHS) released the 2018 HHS Final Notice of Benefit and Payment Parameters. For plan years beginning in 2018, the annual cost sharing limitation for essential health benefits will be $7,350 for employee only (single) coverage, and $14,700 for other than employee only (family) coverage.
High Deductible Health Plan Limits
In addition, the Internal Revenue Service (IRS) recently released the Revenue Procedure 2017-37, which announces the inflation-adjusted limits for Health Savings Accounts (HSAs) And High Deductible Health Plans (HDHPs) for 2018. These limits include:
- The maximum HSA contribution limit;
- The minimum deductible amount for HDHPs; and,
- The maximum out-of-pocket expense limit for HDHPs.
These limits vary based on whether an individual has self-only or family coverage under a HDHP.
It is important to note that the IRS limits for HSA contributions and HDHP cost-sharing will all increase for 2018:
The following chart illustrates the HSA/HDHP limits for 2018, as compared to 2017. It also includes the catch-up contribution limit that applies to HSA-eligible individuals who are age 55 or older, which is not adjusted for inflation and stays the same from year to year.
Because the cost-sharing limits for HDHPs (minimum deductible and maximum out-of-pocket) will change for 2018, employers that sponsor these plans may need to make plan design changes for plan years beginning in 2018. Also, if an employer communicates the HSA contribution limits to employees as part of the enrollment process, these enrollment materials should be updated to reflect the increased limits that apply for 2018.
In addition, if utilizing the full HDHP maximum out-of-pock limits, make sure that the limit applicable to a single individual will not exceed the ACA maximums for single only coverage.
If you have any questions, please contact your local Hays Consultant.
By: Ben Graves, J.D., Director of Research and Compliance at Hays Companies.