Reform Alert - News from the Blues' Office of National Health Reform

IRS announces maximum out-of-pocket costs

June 21, 2013

On May 2, the Internal Revenue Service established the 2014 maximum out-of-pocket costs for an HSA-compatible, high-deductible health plan will be $6,350 for self-only coverage and $12,700 for family coverage.

Beginning with plan or policy years starting on or after January 1, 2014, the Affordable Care Act requires that all non-grandfathered individual, small group, large group and self-funded coverage adhere to out-of-pocket maximums on essential health benefits that do not exceed the levels established for HSA-compatible HDHPs.

Last November, the Department of Health and Human Services estimated the 2014 out-of-pocket maximums levels would be $6,400 for self-only coverage and $12,800 for family coverage.

An April 30 FAQ, outlined the process for affected insurers to update their OOP maximums if the IRS final amounts were lower than the HHS estimates.

"In the Federally-facilitated Marketplace, if IRS-published limits are below $6,400/$12,800, HHS will flag Qualified Health Plan applications with out-of-pocket maximums above the allowed amount. Affected issuers will be permitted to revise their out-of-pocket maximums during the resubmission window built into the QHP certification process. HHS encourages states, particularly those participating in a State Partnership Marketplace, to use this approach to allow updates during the revision window."

Additional 2014 levels established:

  • HDHP is defined as a health plan with an annual deductible of no less than $1,250 for self-only and $2,500 for family coverage.
  • Contributions to an HSA can be no more than $3,300 for self-only or $6,550 for family coverage.

Where can I find more information?
More information can be found at

The information in this document is based on preliminary review of the national health care reform legislation and is not intended to impart legal advice. The federal government continues to issue guidance on how the provisions of national health reform should be interpreted and applied. The impact of these reforms on individual situations may vary. This overview is intended as an educational tool only and does not replace a more rigorous review of the law’s applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. As required by US Treasury Regulations, we also inform you that any tax information contained in this communication is not intended to be used and cannot be used by any taxpayer to avoid penalties under the Internal Revenue Code.