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Welcome to the Snell & Wilmer Benefits Blog. We will be posting about current employee benefits and executive compensation topics and issues. We invite you to contact the authors with your thoughts or questions.Blog Contributors
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Trump Signs Act Mandating Group Health Plans Cover COVID-19 Testing For Free
On March 18, 2020, President Trump signed the Families First Coronavirus Response Act (“FFCRA”) requiring group health plans to cover COVID-19 testing for free and without preauthorization. This means no deductibles, no copays, and no coinsurance.
More details regarding the changes employers are required to make are explained in our Employee Benefits Update of March 16, 2020 entitled “COVID-19 Employer Group Health Plan Changes to Help Employees.” One clarification that was made after publishing the Update is that that COVID-19 telehealth testing must also be provided for free. Unfortunately, we still await relief on the telehealth/HDHP issue flagged in the Update. Read More ›
Posted in Health & Welfare Plans, Health Care Reform
| Tagged covid-19, employer health plan, FFCRA, group health plan, HDHP, virus
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Preventive Care Can Now Be Covered for Specified Chronic Conditions Before HDHP Deductible
On July 17, 2019 the IRS released Notice 2019-45 resolving a preventive care problem that has been plaguing many high deductible health plans (“HDHPs.”). The Affordable Care Act’s free preventive care mandate appears to be working. People are catching medical problems sooner. As a result, many employers have embraced the concept of free preventive care and want to go a step further – providing free preventive care for certain chronic conditions, such as asthma, diabetes, and heart disease. However, they have run into a snag. Under IRS guidance, treatment for chronic conditions is not “preventive care” and covering it before the deductible is met jeopardizes the plan’s status as an HDHP. Read More ›
Posted in Employee Benefits, Health & Welfare Plans, Health Care Reform
| Tagged ACA, HDHP, notice 2019-45, preventive care
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IRS Announces 2018 Cost of Living Adjustments
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This post has been updated as of June 7, 2018, to reflect the revised maximum annual HSA contribution limit for family coverage set out in Revenue Procedures 2018-18 and 2018-27. The IRS recently announced cost-of-living adjustments for 2018 in Notice 2017-64 and related guidance. The key dollar limits for qualified retirement plans and health and welfare plans are noted below. Qualified Retirement Plan Dollar Limits |
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| 2017 | 2018 | |
| Limit on Section 401(k) deferrals (Section 402(g)) | $18,000 | $18,500 |
| Dollar limitation for catch-up contributions (Section 414(v)(2)(B)(i)) | $6,000 | $6,000 |
| Limit on deferrals for government and tax-exempt organization deferred compensation plans (Section 457(e)(15)) | $18,000 | $18,500 |
| Annual benefit limitation for a defined benefit plan (Section 415(b)(1)(A)) | $215,000 | $220,000 |
| Limitation on annual contributions to a defined contribution plan (Section 415(c)(1)(A)) | $54,000 | $55,000 |
| Limitation on compensation that may be considered by qualified retirement plans (Section 401(a)(17)) | $270,000 | $275,000 |
| Dollar amount for the definition of highly compensated employee (Section 414(q)(1)(B)) | $120,000 | $120,000 |
| Dollar amount for the definition of a key employee in a top-heavy plan (Section 416(i)(1)(A)(i)) | $175,000 | $175,000 |
| Dollar amount for determining the maximum account balance in an ESOP subject to a five-year distribution period (Section 409(o)(1)(C)(ii)) | $1,080,000 | $1,105,000 |
| SIMPLE retirement account limitation (Section 408(p)(2)(E)) | $12,500 | $12,500 |
| Social Security Taxable Wage Base | $127,200 | $128,700 |
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Health and Welfare Plan Dollar Limits |
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| 2017 | 2018 | |
| Annual Cost Sharing Limit (self-only coverage) | $7,150 | $7,350 |
| Annual Cost Sharing Limit (other than self-only coverage) | $14,300 | $14,700 |
| HDHP Out-of-Pocket Maximum (self-only coverage) | $6,550 | $6,650 |
| HDHP Out-of-Pocket Maximum (family coverage) | $13,100 | $13,300 |
| Annual HDHP Deductible (self-only coverage) | Not less than $1,300 | Not less than $1,350 |
| Annual HDHP Deductible (family coverage) | Not less than $2,600 | Not less than $2,700 |
| Maximum Annual HSA Contributions (self-only coverage) | $3,400 | $3,450 |
| Maximum Annual HSA Contributions (family coverage) | $6,750 | $6,900* |
| Maximum HSA Catch-Up Contribution | $1,000 | $1,000 |
| Health Flexible Spending Account Maximum | $2,600 | $2,650 |
* The maximum annual HSA contribution for family coverage was reduced from $6,900 to $6,850 by Revenue Procedure 2018-18. Read More ›
Posted in Employee Benefits, Health & Welfare Plans, Qualified Retirement Plans
| Tagged COLA, cost of living adjustment, defined benefit, defined contributino, ESOP, FSA, HDHP, health and welfare, HSA, key employee, maximum\, qualified retirement, simple
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Carryover Confusion: Chief Counsel Clears Up Rules on Health FSA Carryovers
Earlier this year, I blogged about how the IRS modified the health flexible spending account (“health FSA”) “use-it-or-lose-it” rule to allow carryovers of up to $500 to subsequent plan years. This rule change caused some confusion. Employers were asking, “what happens to an employee’s eligibility to contribute to a health savings account (“HSA”) if they have a carryover from a general purpose health FSA?” The answer was that because a general purpose health FSA is considered “other coverage,” participation in a general purpose health FSA renders an individual ineligible to contribute to a HSA. But employers still needed guidance on ways to handle health FSA carryovers for employees who also wanted to contribute to a HSA in the following year. Read More ›
Posted in Employee Benefits, Health & Welfare Plans
| Tagged Carryover, HDHP, Health FSA, HSA, IRS, Use-it-or-Lose-it
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