Friday, December 8, 2006
Benefits Alert from the Alexander Hamilton Institute has this interesting piece from its December 7th Newsletter about two recent opinions from the Employee Benefits Security Administration (EBSA) about whether health savings accounts (HSAs) constitute employee benefit plans under ERISA.
The answer in most cases appears to be no:
In two recently released Field Assistance Bulletins, the Employee Benefits Security Administration (EBSA) has concluded that, provided employers' participation with health savings accounts (HSAs) is minimal, HSAs won't be covered under Title I of ERISA as an employee welfare benefits plan. The EBSA has thus removed a critical impediment to employers that had been leery of offering HSAs to employees.
The EBSA noted that while employer contributions are usually an important factor in determining whether a benefit is an employee welfare benefit covered under Title I of ERISA, it said that employer contributions aren't the only factor. More important, the EBSA said, is that HSAs are personal health care savings vehicles, not a form of group health insurance. The EBSA did stress, however, that the high-deductible health plan used for HSAs is probably covered under ERISA as an employee welfare benefits plan.
So high deductible health plans (HDHPs) are most likely covered by ERISA, but not stand-alone HSAs,
established voluntarily by individuals.