2023 HSA and HDHP Cost-of-Living Adjustments Announced

The IRS has announced the 2023 cost-of-living adjustments for health savings accounts (HSAs) and high-deductible health plans (HDHPs):

• HSA Contribution Limits – the 2023 annual HSA contribution limit is $3,850 for individuals with self-only HDHP coverage (up from $3,650 in 2022), and $7,750 for individuals with family HDHP coverage (up from $7,300 in 2022).
• HDHP Minimum Deductibles – the 2023 minimum annual deductible (for purposes of qualifying as a HDHP) is $1,500 for self-only HDHP coverage (up from $1,400 in 2022) and $3,000 for family HDHP coverage (up from $2,800 in 2022).
• HDHP Out-of-Pocket Maximums – the 2023 limit on out-of-pocket expenses is $7,500 for self-only HDHP coverage (up from $7,050 in 2022) and $15,000 for family HDHP coverage (up from $14,100 in 2022).

Employers should mark their calendars for later this year to (1) update their payroll and HSA administration systems to reflect the 2023 cost-of-living adjustments, and (2) incorporate the new limits in any participant communications, plan documents, and summary plan descriptions.