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Out-of-pocket maximum for group health plans announced for 2023

OOPM released for the 2023 plan year represents a 4.3% increase from OOPM for the 2022 plan year.

  • Applies to: All states, Regulatory and compliance

The 2023 out-of-pocket maximum (OOPM) for health plans is $9,100 for single coverage and $18,200 for family coverage. The 2023 OOPM represents a 4.3% increase above the 2022 OOPM of $8,700 for self-only coverage and $17,400 for family coverage.

OOPM for 2023 plan year OOPM for 2022 plan year
Self-only: $9,100 Self-only: $8,700
Family: $18,200 Family: $17,400

The annual OOPM requirement applies to most non-grandfathered group health plans, regardless of whether the plan is fully insured or self-funded (ASO). It does not apply to grandfathered, transitional Relief, and retiree-only plans. The OOPM includes copayments, deductibles, and coinsurance amounts associated with both medical and pharmacy-covered benefits.

High-deductible plans with health savings accounts (HSAs) have limits that are different, including OOPM, deductible, and contribution limits. The Internal Revenue Service has not yet released final rules for 2023 HSA limits. Historically these are released in May. Please contact our office with any questions or concerns.

2019 ACA and HSA Inflation Adjustment

Earlier this year the IRS announced its 2019 inflation adjustment indexing for a number of ACA  provisions such as the employer shared-responsibility penalty affordability percentage (employee contribution limit that determines employer penalty), and Maximum out of pocket limits.

The two shared-responsibility penalties are for when employers fail to meet the minimum essential coverage (4980H(a)) and minimum value and affordability (4980H(b)). The section 4980H(a) penalty may be assessed when an ALE (applicable large employer) does not offer minimum essential coverage to at least 95 percent of its full-time employees, and at least one full-time employee receives a premium tax credit. The section 4980H(b) penalty may be assessed if an ALE offers minimum essential coverage to at least 95 percent of its full-time employees, but at least one full-time employee receives a premium tax credit because the coverage offered was not considered affordable and/or did not provide minimum value.

Employers need to make sure that they don’t overlook the adjusted ACA cost-sharing limits as they could face sharp penalties under the ACA’s shared responsibility provisions. In addition to the ACA adjusted index, the IRS released the 2019 HSA inflation-adjusted contribution limits as well:

2019 ACA and HSA Inflation Adjustment chart

IRS Sets New 2019 Limits For Group Plans and HDHP/HSA Plans

  • Fully Insured and Self-Funded
  • Reform and Regulatory

The Internal Revenue Service (IRS) recently announced the applicable dollar limits for group plans and high deductible health plans (HDHPs) / health savings accounts (HSAs) for the 2019 calendar year.

Below is an overview of the adjusted dollar limits for 2019. Self-only coverage refers to plans for one individual, while family coverage refers to plans for two or more individuals. The out-of-pocket maximum includes copayments, deductibles and coinsurance amounts, and excludes premiums.

Maximum out-of-pocket limit for 2019 group plans:

  • $7,900 for self-only coverage ($7,350 in 2018)

  • $15,800 for family coverage ($14,700 in 2018)

The annual out-of-pocket maximum requirement does not apply to transitional relief and retiree only plans.

2019 Limits for High Deductible Health Plans (HDHP) / Health Savings Accounts (HSA) 

Minimum deductibles for 2019 (no change from 2018):

  • $1,350 for self-only coverage

  • $2,700 for family coverage

  • $2,700 for embedded individual deductible

  • Compliant HSA plan examples:

    • Embedded deductible. One plan for self-only and family have an embedded deductible, the minimum deductibles are: $2,700 individual and $2,700 family.

    • Non-embedded deductible. One plan for self-only and family have a non-embedded deductible, the minimum deductibles are: $1,350 individual and $2,700 family.

Out-of-pocket maximum for 2019:

  • $6,750 for self-only coverage (versus $6,650 in 2018)

  • $13,500 for family coverage (versus $13,300 in 2018)

Watch for the intersection of the HSA and Affordable Care Act (ACA) rules. The 2019 ACA maximum is $7,900 for individual and $15,800 family (versus $7,350 individual and $14,700 family in 2018).

  • Compliant HSA/ACA plan examples:

    • Embedded out-of-pocket max. One plan for self-only and family with an embedded out-of-pocket maximum, the maximum amounts are: $6,750 individual and $13,500 family

    • Non-embedded out-of-pocket max. One plan for self-only and family with a non-embedded deductible, the maximum amounts are: $6,750 individual and $7,900 family

HSA contribution limits for 2019:

  • $3,500 for self-only coverage (versus $3,450 in 2018) 

  • $7,000 for family coverage (versus $6,900 in 2018)

  • The annual “catch-up” contribution amount for individuals age 55 or older will remain $1,000.

IRS reverses decision on 2018 HSA limits

The IRS reversed its March 5 decision to decrease the 2018 contribution limit for family coverage only. The new contribution limit is back to $6,900 (previously adjusted to $6,850).

To review the official IRS announcement, visit the Internal Revenue Service press release (published April 26, 2018).

This means individuals who have already contributed $6,900 are fine and do not need to return any money. And those individuals who have automatic contributions that would have exceeded the earlier $6,850 limit in 2018 are fine. No changes need to be made as long as they do not exceed the $6,900 family contribution maximum.

If you have questions, please contact your representative.