Agencies Release 2020 Adjusted Limits

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Compliance Consultant
+1 314 594 5902
July 9, 2019

Now that the U.S. Department of Health & Human Services (HHS) has released its final rules, and the IRS has released Rev. Proc. 2019-25, we know the 2020 cost-of-living adjustments for non-grandfathered plans subject to the Affordable Care Act (ACA), high-deductible health plans (HDHPs), and health savings accounts (HSAs).

ACA Limit

2019

2020

Out-of-Pocket Maximum Limit[1]

Self-only: $7,900

 

Family: $15,800

Self-only: $8,150

 

Family: $16,300

 

 

HDHP/HSA Limits

2019

2020

HDHP Minimum Deductible

Self-only: $1,350

 

Family: $2,700

Self-only: $1,400

 

Family: $2,800

 

HDHP Maximum Out-of-Pocket

Self-only: $6,750

 

Family: $13,500

Self-only: $6,900

 

Family: $13,800

HSA Annual Contribution Maximum

Self-only: $3,500

 

Family: $7,000

 

Self-only: $3,550

 

Family: $7,100

HSA Catch-up Contribution Limit (age 55 and older)

$1,000

$1,000

Also in HHS’ Final Rules – New Prescription Drug Guidance

Consumers and group health plans alike have struggled with the rising cost of prescription drugs, and there have been numerous high-profile cases involving dramatic price increases for prescription medication. It may seem impossible to effectively reign it in, even with existing manufacturer coupons, discount cards, and other drug-rebating programs. HHS has debated several prescription drug policy changes directed at lowering prices and has adopted a new approach. Beginning in 2020, fully insured and self-insured plans will be able to exclude the value of drug manufacturer coupons used to buy brand-name medications if a medically-appropriate generic-equivalent is available. This change is intended to shift costs from employers to consumers encouraging them to choose equally effective, lower-cost FDA-approved generic medication. This approach is purely optional. Plans do not have to disregard manufacturer coupons and may be able to include those amounts when calculating the participant’s annual out-of-pocket maximum. Keep in mind that some states may prohibit fully insured plans from doing this.


[1] This limit does not apply to plans that remain grandfathered under the ACA.

We are providing this information to you in our capacity as consultants with knowledge and experience in the insurance industry and not as legal or tax advice.  The issues addressed may have legal or tax implications to you, and we recommend you speak with your legal counsel and/or tax advisor before choosing a course of action based on any of the information contained herein.  Changes to factual circumstances or to any rules or other guidance relied upon may affect the accuracy of the information provided. We are not obligated to provide updates on the information presented herein. © 2019 Marsh & McLennan Agency LLC. All Rights Reserved.