Products July 11, 2017

Free Guide Discusses Impact of Medicare on HSAs

HealthSavings Administrators, which created the guide with the help of an attorney, says its emphasis is on helping employees understand the value of HSAs as part of a comprehensive retirement planning strategy.
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HealthSavings Administrators and Paul Verberne, Esq., of Verberne x Maldonado, LLP, have created “A Guide to Health Savings Accounts and Medicare”— a free, 26-page resource covering the basics of health savings accounts (HSAs) and Medicare, as well as how each program impacts the other.

HealthSavings’ emphasis is on helping employees understand the value of HSAs as part of a comprehensive retirement planning strategy. As HSA accountholders near retirement, questions often arise about the impact of Medicare on their HSA.

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For example, accountholders enrolling in Medicare Parts A and/or B can no longer contribute to their HSAs. But this seemingly clear rule often generates more questions—like whether a spouse may continue to contribute to that HSA, what expenses continue to be reimbursable, and how to prorate contributions. The guidebook provides clear and simple answers to these questions and more.

“We wanted to provide some clarity around a topic that is confusing for many HSA accountholders,” says Kirk Hoewisch, president of HealthSavings. “By providing clarity, our hope is that accountholders feel confident continuing to maximize and utilize their HSAs to their fullest potential throughout their retirement.”

The guide is available here.

Compliance July 11, 2017

American Agrees to Pay $22 Million to Settle Proprietary Funds Case

The case accused American Airlines of including affiliated funds in its retirement plan investment lineup though they were more expensive and lower-performing than other funds.
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A preliminary settlement agreement has been submitted for court approval in a case accusing American Airlines of including affiliated funds in its retirement plan investment lineup though they were more expensive and lower-performing than other funds.

The core of the plaintiffs’ claims relate to the use of American Beacon Funds in the plan. AMR Corp., American Airlines’ parent company, created a line of mutual funds that were managed by another subsidiary of AMR Corp. This fund manager was later renamed American Beacon Advisors, Inc. in 2005. Earlier this year, a federal district court judge refused to dismiss the case.

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The gross settlement amount is $22 million, of which $12 million will be contributed by the American Airlines defendants or their agents or insurers and $10 million will be contributed by American Beacon or its agents or insurers.

According to the settlement agreement “the Settling Parties, as defined below, have concluded that it is desirable that this matter be finally settled upon the terms and conditions set forth in this Settlement Agreement.” American Airlines and American Beacon deny any wrongdoing or liability with respect to any of the allegations or claims.

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