Impact of Health Reform on HSAs 

 *See complete article here:  Impact HSAs  

The Patient Protection and Affordable Care Act (PPACA). What is this about? The PPACA is a product of the health care reform agenda signed into law on March 23, 2010. Whether you like it or not, over the next four years the bill will continue to bring into effect numerous healthrelated provisions, such as subsidizing insurance premiums, providing incentives for business to provide health care benefits, prohibiting denial of coverage/claims based on preexisting conditions, etc.

The bill contains certain provisions that have already or will go into immediate effect on specific dates (make note):

• June 21, 2010: In order to qualify for coverage, applicants must have a pre-existing health condition and have been uninsured for at least the past six months. There is no age requirement. Also, it limits out-ofpocket spending to $5,950 for individuals and $11,900 for families, excluding premiums.
   
• September 23, 2010: Dependents (children) will be permitted to remain on their parents' insurance plan until their 26th birthday, and regulations implemented under the act include dependents who no longer live with their parents, are not a dependent on a parent's tax return, are no longer a student or are married. Insurers are prohibited from excluding pre-existing medical conditions for children under the age of 19 and from charging co-payments or deductibles for preventive care and medical screenings on all new insurance plans. Insurers' abilities to enforce annual spending caps will be restricted and completely prohibited by 2014.
  
  
• January 1, 2011: Employers must disclose the value of the benefits they provided beginning in 2011 for each employee's health insurance coverage on the employee's annual Form W-2's, and insurers will be required to spend between 80 and 85 percent of individual plan premiums (with certain adjustments) on health care, or to improve health-care quality or return the difference to the customer as a rebate.
   
• January 1, 2014: Insurers are prohibited from discriminating against or charging higher rates for any individuals based on pre-existing medical conditions and from establishing annual spending caps. A $2,000 per employee tax penalty has been imposed for employers with more than 50 employees who do not offer health insurance to their full-time workers. A maximum of $2,000 annual deductible for a plan covering a single individual or $4,000 annual deductible for any other plan been established. There will be a new $2,500 limit on tax-free contributions to FSAs, which allow for payment of health costs.