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week ending August 21st, 2020
A recent survey found that the majority of employees said they use their health savings accounts (HSAs) as spending vehicles. Being tied to a high-deductible health plan (HDHP), and with health care costs high anyway, the out of pocket expenses can be a burden. During the COVID-19 crisis, the IRS realized the need to allow for HDHPs to cover certain expenses without losing their HSA-eligible status. And efforts are ongoing to expand the services for which HDHPs are allowed to cover. When educating employees about HSAs, employers should understand employees’ needs. Still, there is an opportunity for some employees to save in their HSAs for health care costs in retirement. Enjoy this edition of PLANSPONSOR Weekend!
Editor's Choice
Benefits
Rethinking HSAs
With the high cost of health care, employees are using HSAs as spending, not savings, vehicles, and if more people had access to them, it might help with America’s health care crisis.
Compliance
IRS OKs HDHP Coverage of Coronavirus Testing
High-deductible health plans (HDHPs) will not lose their special status merely because they cover the cost of testing for or treatment of COVID-19 before plan deductibles have been met.
Compliance
Additional Preventive Care Benefits Permitted for HDHPs
The IRS has issued guidance allowing high-deductible health plans (HDHPs) with health savings accounts (HSAs) to cover specified medications and services used to treat chronic diseases prior to meeting the plan deductible.
Benefits
Following Up on HSAs After Open Enrollment
Educating employees about health savings accounts can help them maximize their benefit.
Benefits
Tying HSAs to Retirement Savings
Kelley Long, certified financial planner with Financial Finesse, shared information to help employers promote health savings accounts (HSAs) as a retirement savings tool for employees.
Popular Reads
Compliance
Claims Over Fidelity’s Use of Participant Data Dismissed
A federal judge determined participant data is not considered plan assets, meaning Fidelity was not a fiduciary with regard to the claims.
Data and Research
Near-Retirees Flummoxed by Social Security Benefits
Respondents to a survey by MassMutual revealed certain topics they have questions about.
Investing
In the Future, the Bias Will Likely Be for Annuities
For now, sources say there needs to be more education and a change of thought to help 401(k) plan sponsors and participants accept the income-generation value of annuities.
2020 Recordkeeping Survey
Investing
What to Know Before Adding an SDBA to Your Plan
Self-directed brokerage accounts offer a multitude of options to the hands-on investor, but there are pros and cons of allowing retirement plan participants to use them.
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