Employer’s Alert: New Health Insurance and other Benefit Plan Limits for 2019

Annual dollar limits affect many employee benefit plans, and are periodically adjusted to allow for inflation. The Internal Revenue Service (IRS) recently announced a series of such cost-of-living adjustments for various welfare and retirement plan limits for 2019.

Annual limits for these benefits vehicles will increase for the coming year:

  • High-deductible health plans (HDHPs) and health savings accounts (HSAs)
  • Health flexible spending accounts (FSAs)
  • Transportation fringe benefit plans
  • 401(k) plans

Let’s take a look at the details:

For individuals, the HDHP coverage contribution limit will increase by $50 in 2019, to $3,500. For family coverage, the limit increases by $100, to $7,000. The $1,000 limit on catch-up contributions remains the same in the coming year.

The minimum deductibles for HDHPs remain unchanged for both individuals and families, but the maximum out-of-pocket limits increase by $100 and $200, respectively.

The limit on Health FSA pre-tax contributions increases by $50 to $2,700. The dependent care tax exclusion is unchanged.

In the area of transportation benefits, a $5 monthly increase will be in effect for both transit pass/vanpooling and parking benefits, with both moving to $265 in 2019.

2019 will see a $500 rise in the limit for employee elective deferrals to a 401(k) plan, with a new limit of $19,000. Catch-up contributions are unchanged, remaining limited at $6,000 annually.

In addition to these widely-used benefits plans, limits will increase in 2019 for adoption benefits and Qualified Small Employer HRAs (QSEHRAs).

Employers should review their plan designs and administration to make sure the new limits are accounted for, and should communicate these new limits to employees.

Questions about the new limits or other employee benefits issues? Contact Consolidated Insurance.