The Internal Revenue Service has adjusted the contribution limits for employer-sponsored health plan benefits based on inflation. The following changes will be effective January 1, 2023.
| Benefit | 2022 Limit | 2023 Limit |
|---|---|---|
| Health Savings Account (HSA) | $3,650 single coverage $7,300 family coverage |
$3,850 single coverage $7,750 family coverage |
| Catch-up Contributions | $1,000 | $1,000 |
| High Deductible Health Plan (HDHP) |
At least $1,400 single coverage with $7,050 maximum out of pocket At least $2,800 family coverage with $14,100 maximum out of pocket |
At least $1,500 single coverage with $7,500 maximum out of pocket At least $3,000 family coverage with $15,000 maximum out of pocket |
| Excepted Benefit* Health Reimbursement Arrangement (HRA) | $1,800 | $1,950 |
* Excepted benefit plans are those that cover benefits such as vision and dental that do not fall under ACA regulation and are not covered by the employer’s health insurance plan.
Out-of-pocket expenses are inclusive of deductibles, co-payments, and coinsurance, but do not include premiums.
Employees turning 55 and older in 2023 are able to contribute an additional $1,000 in catch-up funds to an individual HSA account. Catch-up contribution amounts are set by statute and are not adjusted for inflation, so they did not change for 2023.
Individuals carrying family health care coverage should keep one important fact in mind about catch-up contributions and HDHP participation. An individual may elect to contribute up to the maximum family contribution amount, but the combined contribution amount for married spouses should not exceed the maximum family limit. In addition, catch-up contributions into an HSA account must be made independently by each spouse. HSAs are individual accounts, so in order for both spouses to take advantage of catch-up contributions, each must hold an individual HSA account, even if covered under the same insurance plan. Special rules apply for family limits, if a dependent is claimed on another person’s tax return, so it is advised that employees consult a tax professional prior to making any HSA elections if that situation applies.
Contribution limits for other benefits have not been announced at this time and are typically provided toward the middle or end of the fourth quarter each year. HSA, HRA, and high-deductible plan limits are typically announced in May, to allow organizations time to budget and plan for open enrollment changes.
