Tag: Health Savings Accounts

September 15 to October 15 is National Hispanic Heritage Month

National Hispanic Heritage Month is the period from September 15 to October 15 in the United States, when people recognize the contributions of Hispanic and Latino Americans to the United States and celebrate the group’s heritage and culture.

Started as Hispanic Heritage Week by president Lyndon Johnson in 1968, September 15 was chosen as the starting point for the celebration because it is the anniversary of independence of five Latin American countries: Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua. All declared independence in 1821. In addition, Mexico, Chile and Belize celebrate their independence days on September 16, September 18, and September 21, respectively.

As a Minority Business Enterprise (MBE), one of our core beliefs as a company has always been to celebrate diversity and inclusion. Sterling Administration supports our Spanish-speaking Employer Clients and Members with services including a Spanish language option for our full-service website, online enrollment, educational materials, forms, and customer service.

¿Habla Español?
Nuestro compromiso con los latinos no es simplemente hablarles en español, sino realmente entender y hablar su mismo idioma. Aprende más.

Are you an Industry Partner with clients looking for a solution in Spanish?
Contact us today to learn more.

What Happens to my HSA When I Die?

It’s a topic many of us don’t like to talk – or even think – about, but if you don’t designate a beneficiary for your HSA (Health Savings Account) the ramifications may not be in line with your wishes.

What happens to your HSA upon your death?

When you open your Sterling account, you will be asked to designate one or more beneficiaries to whom distribution of your HSA will be made upon your death. You may revoke this beneficiary designation at any time and designate different individuals as beneficiaries. Any beneficiary designation you make must be delivered to Sterling prior to your death on a form provided by or acceptable to Sterling. If you do not make a valid beneficiary designation prior to your death, Sterling will distribute the assets in your HSA to your estate. In some states, your spouse’s consent may be necessary if you wish to name a person other than or in addition to your spouse as beneficiary or if you change an existing beneficiary designation. Please consult with your attorney before making your beneficiary designation.

What are the income tax consequences after your death?

If your spouse is the named beneficiary of your HSA, your HSA becomes the HSA of your spouse upon your death, subject to the completion of documents required by Sterling. The surviving spouse is subject to income tax only to the extent distributions from the HSA are not used for qualified medical expenses. If your HSA passes to a person other than your surviving spouse, the HSA ceases to be an HSA as of the date of your death, and the beneficiary is required to include the fair market value of the HSA assets as of the date of your death in his or her gross income. The includable amount is reduced by any payments from the HSA for your qualified medical expenses, if such payments are made within one year after your death.

If you have not made a valid beneficiary designation, your HSA ceases to be an HSA upon your death and the fair market value of the assets in your HSA, as of the date of death, is includable in your gross income for the year of death.

You can learn more here.

From the CEO: Preventive Care Services & HSAs

I’m continuing my informal tutorial on HSAs. I’ve been asked about preventive care services and what qualifies as preventive care that must be provided by your insurance carrier without regard to any cost sharing. Generally, the list of allowed preventive care includes (but is not limited to) the following:

  1. Periodic health evaluations, including tests and diagnostic procedures
  2. Routine prenatal and well-child care
  3. Child and adult immunizations, including flu shots
  4. Stop smoking programs
  5. Obesity weight-loss programs
  6. Screening services, like mammograms, colonoscopies, PSA tests

The IRS makes clear that preventive care does not generally include any service or benefit intended to treat an existing illness, injury or condition.

I am sometimes asked about how drugs or medications are considered in light of preventive care services. The IRS code (Section 223(c)(2)(C) notes that drugs or medications are considered preventive when taken by a person who has developed risk factors for a disease that has not become clinically apparent or to prevent the reoccurrence of a disease from which a person has recovered. Examples include the treatment of high cholesterol with cholesterol-lowering medications like statins or the treatment of stroke victims with angiotensin-converting enzyme (ACE) inhibitors to prevent a reoccurrence.

If you would like more information about this, a comprehensive listing of covered preventive services can be found here.

Sincerely,

 

 

 

Cora M. Tellez
President & CEO
Sterling Administration

IRS sets 2016 Health Savings Account contribution limits

Editor note: This article was originally published on May 5, 2015 by Business Insurance and can be found here.

The maximum contributions that can be made to health savings accounts in 2016 will increase $100 for families, but remain unchanged for individuals.

The Internal Revenue Service announced Monday that the maximum contribution that can be made next year to an HSA linked to a high-deductible plan will be $6,750 for employees with family coverage, up from $6,650, while the maximum contribution for those with single coverage will remain at $3,350.

However, maximum out-of-pocket expenses will increase in 2016 for both categories.

Maximum out-of-pocket employee expense, including deductibles, will rise $100 next year to $6,550 for single coverage, and increase $200 next year to $13,100 for family coverage.

For 2016, a high-deductible health plan is defined as a one with an annual deductible of least $1,300 for self-only coverage and $2,600 for family coverage.

Increases in the HSA limits, which are detailed in Revenue Procedure 2015-30, are tied to changes in the cost of living.

Learn more about Health Savings Accounts.