HSA "max out of pocket"?

#2 02-05-2004, 09:54 PM

- quote -

> > > I've never understood the rationale for it, but, for MSA's,
> > > my understanding has been that the Max out-of-pocket had to
> > > be (at least?) twice the deductible. Does the same apply to
> > > HSAs?

> > Per the IRS:
> > > Q-3. What is a "high-deductible health plan" (HDHP)?
> > A-3. Generally, an HDHP is a health plan that satisfies
> > certain requirements with respect to deductibles and
> > out-of-pocket expenses. Specifically, for self-only
> > coverage, an HDHP has an annual deductible of at least
> > $1,000 and annual out-of-pocket expenses required to be paid
> > (deductibles, co-payments and other amounts, but not
> > premiums) not exceeding $5,000. For family coverage, an HDHP
> > has an annual deductible of at least $2,000 and annual
> > out-of-pocket expenses required to be paid not exceeding
> > $10,000.

> Yeah, I had read that. Unless I'm missing something, all it
> says is that the 'max out-of-pocket' can't _exceed_ $10K.
> The wording is similar for MSAs. But, I have been told by
> two different insurance carriers that the 'minimum max
> out-of-pocket' (if you will) for both is, by law, twice the
> deductible.
> For instance, our current policy has a $2250 deductible, and
> a MOOP of $2250 (that's direct from the plan description).
> But, the carrier says it's not MSA- or HSA-eligible plan.
> They have another plan, otherwise identical, with a MOOP of
> $4500, which they say _is_ eligible.
> I assume they're speaking accurately WRT the MSA, since I've
> gotten that story several times over the years. What I'm
> not sure is whether the same 'twice the deductible" rule
> also applies with HSAs, or if the carrier is possibly just
> erroneously appling the MSA rule to the newer producct.

There is no 2X rule by law for MSAs.
Using self-only coverage as an example:
The minimum deductible is $1700, the max is $2500. The max
out-of-pocket is $3350.
The values are fixed and indexed for inflation.

--
Alan
http://taxtopics.net

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

#1 02-05-2004, 05:07 AM

"A.G. Kalman" <glendale202-mtm[at]yahoo.com> wrote:
- quote -

> ge wrote:

> > I've never understood the rationale for it, but, for MSA's,
> > my understanding has been that the Max out-of-pocket had to
> > be (at least?) twice the deductible. Does the same apply to
> > HSAs?

> Per the IRS:
> Q-3. What is a "high-deductible health plan" (HDHP)?
> A-3. Generally, an HDHP is a health plan that satisfies
> certain requirements with respect to deductibles and
> out-of-pocket expenses. Specifically, for self-only
> coverage, an HDHP has an annual deductible of at least
> $1,000 and annual out-of-pocket expenses required to be paid
> (deductibles, co-payments and other amounts, but not
> premiums) not exceeding $5,000. For family coverage, an HDHP
> has an annual deductible of at least $2,000 and annual
> out-of-pocket expenses required to be paid not exceeding
> $10,000.

Yeah, I had read that. Unless I'm missing something, all it
says is that the 'max out-of-pocket' can't _exceed_ $10K.
The wording is similar for MSAs. But, I have been told by
two different insurance carriers that the 'minimum max
out-of-pocket' (if you will) for both is, by law, twice the
deductible.

For instance, our current policy has a $2250 deductible, and
a MOOP of $2250 (that's direct from the plan description).
But, the carrier says it's not MSA- or HSA-eligible plan.
They have another plan, otherwise identical, with a MOOP of
$4500, which they say _is_ eligible.

I assume they're speaking accurately WRT the MSA, since I've
gotten that story several times over the years. What I'm
not sure is whether the same 'twice the deductible" rule
also applies with HSAs, or if the carrier is possibly just
erroneously appling the MSA rule to the newer producct.

George

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

02-04-2004, 02:54 AM

ge wrote:

- quote -

> I've never understood the rationale for it, but, for MSA's,
> my understanding has been that the Max out-of-pocket had to
> be (at least?) twice the deductible. Does the same apply to
> HSAs?

Per the IRS:

Q-3. What is a "high-deductible health plan" (HDHP)?
A-3. Generally, an HDHP is a health plan that satisfies
certain requirements with respect to deductibles and
out-of-pocket expenses. Specifically, for self-only
coverage, an HDHP has an annual deductible of at least
$1,000 and annual out-of-pocket expenses required to be paid
(deductibles, co-payments and other amounts, but not
premiums) not exceeding $5,000. For family coverage, an HDHP
has an annual deductible of at least $2,000 and annual
out-of-pocket expenses required to be paid not exceeding
$10,000.

Source:
http://www.treas.gov/press/releases/...otice20042.pdf

--
Alan
http://taxtopics.net

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

#-1 02-01-2004, 11:45 PM

I've never understood the rationale for it, but, for MSA's,
my understanding has been that the Max out-of-pocket had to
be (at least?) twice the deductible. Does the same apply to
HSAs?

TIA,
George

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

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