The Internal Revenue Service (IRS) has released the inflation-adjusted health savings account (HSA), high-deductible health plan (HDHP), and excepted-benefit health reimbursement arrangement (HRA) limits for 2027. These annual adjustments provide employers with an early opportunity to evaluate benefit strategies, update employee communications, and prepare plan documents for the upcoming year.
The additional $1,000 catch-up contribution remains unchanged because it is established by statute rather than adjusted annually for inflation.
Employers should remember that HSA-compatible HDHP limits differ from the Affordable Care Act’s annual out-of-pocket maximums applicable to non-grandfathered group health plans.
The Centers for Medicare & Medicaid Services (CMS) and the Department of Health and Human Services (HHS) establish separate ACA cost-sharing limits each year. Historically, ACA out-of-pocket maximums have been substantially higher than the HDHP maximums required for HSA eligibility. As a result, employers offering HSA-qualified plans must ensure they satisfy both sets of requirements where applicable.
Why Employers Should Pay Attention Now
Although these figures apply to 2027, many employers begin benefit strategy discussions months before open enrollment. The newly released limits can affect:
- Employer HSA contribution budgets
- Employee communication materials
- Open enrollment education campaigns
- HDHP plan design decisions
- Payroll deduction configurations
- Benefits administration systems
For organizations that make employer HSA contributions, even relatively small annual increases can affect budgeting across large employee populations.
Early communication to employees regarding new contribution opportunities may improve employee engagement and utilization of tax-advantaged healthcare savings vehicles.
Employer Action Items
- Review 2027 HDHP designs for compliance with IRS deductible and out-of-pocket requirements.
- Update HSA contribution materials and payroll systems before open enrollment.
- Evaluate employer HSA funding strategies and budget impacts.
- Monitor future CMS and HHS guidance regarding 2027 ACA out-of-pocket maximums and other annual indexing adjustments.
This information has been prepared by UBA. It is general information and provided for educational purposes only. It is not intended to provide legal advice. You should not act on this information without consulting legal counsel or other knowledgeable advisors.
