The American Bankers Association’s Health Savings Account Council this week outlined multiple steps the Centers for Medicare and Medicaid Services can take to allow more Americans to qualify for and use an HSA. In a letter to the acting administrator of CMS, the council summarized policy challenges within the agency’s regulatory authority that are limiting the growth of HSAs and offered solutions.
One solution would be for CMS to manage its rules around Social Security eligibility so that seniors still working who elect to take their Social Security benefits early do not also get automatically enrolled in Medicare Part A, which is a disqualifying event for making HSA contributions.
“Creating this flexibility will preserve the Social Security retirement insurance benefits of seniors who choose not to receive benefits under Medicare Part A, and it will allow millions of seniors to collect their Social Security benefits without canceling their ability to contribute to their HSAs,” the HSA Council said.
The council also asked for the same flexibility to be applied when measuring an employer plan’s drug coverage, and for relief from an Affordable Care Act requirement for standardized plans implemented under the Biden administration.
“Health insurers may offer HSA plans, but they are limited to offering only two additional plans that are not standardized plan designs,” the council said. “Thus, HSA-qualified plans have to compete for ‘limited shelf space’ on the menu of health plan options. The result has been that enrollment in HSA-compatible plans has dropped from a high of 11% of enrollment to only 3% over the past decade.”
