The IRS announced on Thursday, April 26, that it is modifying the annual limitation on 2018 HSA family contributions. Under Rev. Proc. 2018-27, taxpayers will be allowed to treat $6,900 as the annual limitation for 2018, instead of the $6,850 limitation announced by the IRS earlier this year.

The recalculation comes as taxpayers, employers and payroll administrators complained that the change would be costly and difficult to implement.
Simply put: For 2018, the maximum contribution for an individual with family coverage is $6,900.

Please do not hesitate to contact us at 855.890.7239 orcustomerservice@nuesynergy.com if you have any questions or concerns.

ICYMI: NueSynergy announces partnership with Employee Navigator

As an innovative leader for over two decades in providing full-service administration of consumer-driven and traditional account-based plans, we’re always looking for new ways at NueSynergy to raise the bar in benefit value and overall experience for our clients and employer partners. As part of these efforts, we’ve recently partnered with Employee Navigator, one of the fastest growing SaaS-based benefits and HR platforms in the United States.

Millennials and the consumer-driven health care market

Over the last decade, this shift in buyer expectations has altered the health care delivery landscape. It’s no secret health care organizations are moving towards participant-focused models. Millennials, in large part, are helping to influence this change. For example, they are more likely than other generations to seek out alternative health care options and research plan options, doctor/hospital ratings and cost of care before utilizing the services.

Q: What happens to my HSA after employment ends?

Since your HSA is owned by you and not your employer, your HSA remains available to you even after termination. This means that you can continue to use your HSA for qualified expenses even after your termination. Your ability to continue contributing to your HSA will be dependent on whether you choose to enroll in an HSA-qualified health insurance plan either through your new employer or through an individual policy.

5 ways to transform work gossip into positive communication

Work gossip. We’ve all heard it. Some of us have spread it — whether it took place in the break room, via text or email. While gossip can be detrimental to the workplace, there are ways for leaders to redirect this destructive habit into channels for positive change.

Have any interesting news you’d like to share?

Send it our way! We won’t be your personal billboard, but we’ll consider posting any article or editorial related to the health care or financial services industries.

Millennials and the consumer-driven health care market

According to the Pew Research Center, Millennials are projected to surpass Baby Boomers in 2019 as the largest living adult generation. Although Millennials are negatively stereotyped as the generation of “instant gratification”, newer business models and emerging technologies have conditioned all of us to expect instant results from the companies we partner with and do business.

Over the last decade, this shift in buyer expectations has altered the health care delivery landscape. It’s no secret health care organizations are moving toward participant-focused models. Millennials, in large part, are helping to influence this change. For example, they are more likely than other generations to seek out alternative health care options and research plan options, doctor/hospital ratings and cost of care before utilizing the services.

We also need to know Millennials are significantly more diverse than older generations, and health care organizations are working more than ever to better understand this consumer segment. When targeting Millennials for their health care needs, c2b solutions’ has grouped Millennials into five segments:

Self Achievers
Balance Seekers
Priority Jugglers
Willful Endurers
Direction Takers
With the understanding Millennials cannot be defined as one key demographic, agents and brokers can focus on more targeted messages to build greater engagement. Millennials may not want to hear about a CDHP or HSA by reading through a benefit booklet, but they may become more engaged with a tailored video explaining the benefits of investing in an HSA. While creating a video is a lot more expensive than printing a benefit booklet, a video will have a longer “shelf life” and can be shared across multiple channels, connecting with more participants. Other alternatives are available, such as presenting benefit information in a web-friendly format across social media channels.

Millennials are looking to invest and an HSA is the perfect vehicle

It’s clear an updated communications strategy is crucial for reaching the younger generations. What worked before no longer applies today. However, while generational and marketplace shifts can be painful, HSAs are perfectly calibrated for the emerging market, as they offer flexible and participant-friendly benefits, such as:

100% of unused funds roll over year-after-year
Funds go with you even if you switch employers
Can pay for the eligible expenses of your legal spouse and tax dependents regardless of their insurance
Can be used for Medicare premiums as well as qualified long-term care premiums
Further, according to a recent report from EBRI, Millennials are more interested than Baby Boomers in investing their money into an HSA. This presents us with a unique opportunity to educate and promote the HSA as an investment tool. HSAs provide more benefits than the traditional Investment Retirement Account (IRA) and can be invested into bank accounts, stocks, bonds, money market funds and mutual funds. Rather than using the HSA solely to pay for medical expenses, participants have the flexibility to choose when and when not to use their HSA dollars. By paying for qualified medical expenses with after-tax dollars, the HSA balance grows tax-free. Many HSA participants elect to pay smaller expenses with after-tax dollars, allowing their balances to grow for the future.

It’s important for participants of all generations to understand the best way to use the HSA is by treating it as an investment tool, primarily because of the triple-tax advantage. In 2016, 4% of accounts had investments other than cash. It goes without saying this understanding won’t occur overnight. It’s also unreasonable to expect every participant to have the wherewithal to use their account solely for investing. However, as Millennials continue to move the needle toward consumer-driven health care, it’s realistic to expect a behavioral shift and an uptick in participants using the HSA as an investment tool. Participants need to look to their financial advisors when planning their HSA investment strategy, much like they would with a 401(k) or IRA. But in the end, the choice belongs to the participant.

Health Savings Accounts (HSAs) are skyrocketing in popularity as premium increases have become the new normal in this uncertain market. In fact, recent reports project 30 million accounts, with assets exceeding $60 billion, by the end of 2019[1]. To put those numbers into perspective, there were around 6 million accounts in 2008[2].

HSAs also remain popular because consumers are looking for more choices and more ways to save. For example, HSAs offer triple tax savings. This means any HSA contributions can be made either pre-tax or are tax deductible at year-end. Any interest income or earnings on investments tied to an HSA remains tax free. Lastly, as long as the HSA funds are used to pay for qualified health care expenses then no taxes will be charged on distributions.

Additional benefits of the HSA include:

100% of unused funds roll over year-after-year
Funds go with you even if you switch employers
Can pay for the eligible expenses of your legal spouse and tax dependents regardless of their insurance
Can be used for Medicare premiums as well as qualified long-term care premiums
“Hidden” benefits of the HSA:

An often-overlooked benefit of the HSA is its function as an investment tool. HSAs provide more benefits than the traditional Investment Retirement Account (IRA) and can be invested into bank accounts, stocks, bonds, money market funds and mutual funds. Rather than using the HSA solely to pay for medical expenses, participants have the flexibility to choose when and when not to use their HSA dollars. By paying for qualified medical expenses with after-tax dollars, the HSA balance grows tax-free. Many HSA participants elect to pay smaller expenses with after-tax dollars, allowing their balances to grow for the future.

Let’s say a participant is in the 25% tax bracket and contributes the maximum family contribution to an HSA (currently $6,850) for 30 years with a 4% annual return. They would have nearly $400,000 at the end of this period. They could use that money to cover healthcare costs in retirement; and beginning at age 65, the distributions from the account are tax-free if used for qualified medical expenses. If funds are used for non-qualified expenses, the distribution becomes taxable, but exempt from the 20% penalty.

In contrast, if a participant used their HSA assets to pay for out-of-pocket healthcare expenses and diverted investments to a taxable account, their assets would not compound at the same rate and they wouldn’t receive the favorable tax breaks offered through the HSA.

Keep expectations realistic and invest wisely

It’s important for participants to understand the best way to use the HSA is by treating it as an investment tool, primarily because of the triple-tax advantage. In 2016, 4% of accounts had investments other than cash[3]. It goes without saying this understanding won’t occur overnight. It’s also unreasonable to expect every participant to have the wherewithal to use their account solely for investing. However, by educating participants and employers on the long-term value of the HSA, it’s realistic to expect a behavioral shift and an uptick in participants using the HSA as an investment tool. Participants need to look to their financial advisors when planning their HSA investment strategy, much like they would with a 401(k) or IRA. But in the end, the choice belongs to the participant.

You can also read this article on Employee Benefit Adviser

[1] 2017 Midyear HSA Market Statistics & Trends Executive Summary

[2] 2016 Survey of Health Savings Account – High Deductible Health Plans

[3] Trends in Health Savings Account Balances, Contributions, Distributions, and Investments, 2011‒2016: Statistics from the EBRI HSA Database

As an innovative leader for over two decades in providing full-service administration of consumer-driven and traditional account-based plans, we’re always looking for new ways at NueSynergy to raise the bar in benefit value and overall experience for our clients and employer partners.

As part of these efforts, we’ve recently partnered with Employee Navigator, one of the fastest growing SaaS-based benefits and HR platforms in the United States.

Through this partnership, we will streamline the process of providing clients an array of capabilities ranging from consolidated billing services to traditional benefits administration and online enrollment. Employee Navigator is the preferred software provider for more than 18,000 companies and 2 million employees nationwide.

Below you will find a list of our products currently integrated with Employee Navigator and how they can benefit you and your company:

FSA, HRA, HSA ACCOUNTS

– Single system of record for all tax favored accounts
– Carrier integration for enhanced claim filing and substantiation
– Smart, intuitive debit card takes the effort out of managing funds
– True mobile app with AI feature
– Educational campaigns helping employees get the most of their benefits
– Dedicated account manager for each group

COBRA
– Custom Qualifying Event notice sent to employees, spouses and dependents informing them of ability to elect
– COBRA continuation of coverage
– Dedicated COBRA account manager
– COBRA premium payment management
– COBRA audit support

DIRECT BILL
– Invoice, collect and simplify paperwork associated with Leave of Absence (LOA), Family Medical Leave Act (FMLA), Retiree Billing and other billing needs
– Flexible, non-COBRA employer-directed premium billing and collection processing
– Improved employer cash flow through increased accuracy, timely billing and access to back-up documentation

CONSOLIDATED BILLING
– Receive initial and ongoing group enrollment information via Employee Navigator
– Pull monthly statements from each carrier once authorized by employer
– Audit carrier bills against our system of record for accuracy
– Single bill for all carriers with detailed report on enrollees, elections and premium amounts
– Remit payment in the amount due to each carrier
– Initiate one ACH debit for total amount due to all carriers

IRS announces changes to 2018 HSA family contribution limits

The IRS has published Internal Revenue Bulletin (IRB) 2018-10 that contains Revenue Procedure (Rev. Proc.) 2018-19.

Effective for calendar year 2018, the family contribution limit for HSAs has been lowered to $6,850 from the previously set amount of $6,900.

To cover the high deductibles, health care spending accounts, such as Health Reimbursement Arrangements (HRAs) and Health Savings Accounts (HSAs), have become increasingly popular during this time. They help individuals and families pay for medical expenses and provide for more control over those expenses, which encourages them to become more informed consumers of health care services and products.

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Stop spending and start investing your HSA funds

An often-overlooked benefit of the HSA is its function as an investment tool. HSAs provide more benefits than the traditional Investment Retirement Account (IRA) and can be invested into bank accounts, stocks, bonds, money market funds and mutual funds. Rather than using the HSA solely to pay for medical expenses, participants have the flexibility to choose when and when not to use their HSA dollars. By paying for qualified medical expenses with after-tax dollars, the HSA balance grows tax-free. Many HSA participants elect to pay smaller expenses with after-tax dollars, allowing their balances to grow for the future.

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House lawmakers introduce bill to expand HSA services

On Thursday, March 2, House lawmakers introduced legislation designed to expand the types of services covered under health savings accounts without being subject to a deductible.

House Resolution 5138 seeks to give employers and plans the ability to cover chronic disease prevention before a patient has met his or her deductible.

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Your cybersecurity to-do list

According to Juniper Research, cybercrime will cost businesses $2 trillion by 2019, a threefold increase from 2015. That’s a staggering number. So what are you doing to protect your business from a cyber attack? Do you have the ability to mount a cyber defense? Or are you just hoping for the best?

Please take a moment to read this article from Eric Cole, CEO of Secure Anchor, to see what you can do to protect your company from the inevitable.

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Train your brain for sales success

Have so much to do you don’t know where to start? We’ve all been there. Please take a moment to read this discussion with professor and critically acclaimed author, Daniel Goleman, on how ‘mindfulness training’ can heighten your attention and focus in the workplace, allowing you to focus on what’s most important – such as increasing sales and closing more business.

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Have any interesting news you’d like to share?

Send it our way! We won’t be your personal billboard, but we’ll consider posting any article or editorial related to the health care or financial services industries.