IRS Announces Limits for Health Savings Accounts and High-Deductible Health Plans for 2019

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Recently the Internal Revenue Service (IRS) announced (see Revenue Procedure 2018-30) cost-of-living adjustments to the applicable dollar limits for health savings accounts (HSAs) and high-deductible health plans (HDHPs) for 2019. As a result of the 2017 tax reform legislation, the inflation indexing measure was changed from using the consumer price index to chained consumer price index. While this new approach resulted in some changed limits after the initial announcement and subsequent relief for 2018, it should not similarly affect the limits for 2019 and later years.

The table below compares the applicable dollar limits for HSAs and HDHPs for 2018 and 2019.

HEALTH AND WELFARE PLAN LIMITS 2018 2019
HDHP – Maximum annual out-of-pocket limit (excluding premiums):
 Self-only coverage $6,650 $6,750
 Family coverage $13,300 $13,500
 HDHP – Minimum annual deductible:
 Self-only coverage $1,350 $1,350
 Family coverage $2,700 $2,700
 HSA – Annual contribution limit:
 Self-only coverage $3,450 $3,500
 Family coverage $6,900 $7,000
 Catch-up contributions (age 55 or older) $1,000 $1,000

Plan sponsors should update payroll and plan administration systems for the 2019 cost-of-living adjustments and should incorporate the new limits in relevant participant communications, like open enrollment and communication materials, plan documents and summary plan descriptions.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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