Historical HSA Contribution Limit

Written by:
PK

Every year, the IRS sets the maximum HSA contribution limits based on previous limits and inflation, measured by CPI. They maintain a number of variables, chief among them an individual limit, a family limit, and an age 55+ additional "catch-up" contribution limit.

What is the HSA contribution limit in 2022?

The 2022 HSA contribution limit for an individual is $3,650. For a family plan, the limit is$7,300. If you are 55 years old or older, you can also contribute up to $1,000 in "catch-up" contributions. This is up from$3,600, $7,200, and unchanged from$1,000 in 2021, respectively.

History of the Health Savings Account limit, Catch-Up Contributions, and Deductibles Needed for a HDHP to Qualify (2004-2022)

Following this is a table which shows the complete history of the Health Savings Account limit. On the right we've listed the qualifications for qualified plans.

Here's how the HSA limits have evolved:

Health Savings Accounts, or HSAs, came to the United States in 2004 with the 2003 passing of the Medicare Prescription Drug, Improvement, and Modernization Act.

Health Savings Accounts are linked to 'High Deductible Health Plans' – the first dollars of annual health spending come from an insured person before insurance covers any medical care. As an incentive, HSA deposits are tax-free, and withdrawals are tax-free when used for Medical Care.

How Health Savings Accounts Began

HSAs improve greatly on their predecessor, Medical Savings Accounts. They define how employers can contribute to the plan while expanding the amount allowed for contributions.

The Health Saving Account's popularity has soared since the Patient Protection and Affordable Care Act. That law allowed greater access to high deductible health insurance plans, especially for people without traditional coverage through their employers.

Health Saving Accounts have a very interesting feature: since the rate of contributions is often capped by an employer: medical expenses incurred while under a High Deductible and after the HSA was established can be reimbursed in any taxable year. This means HSA holders can hold medical care receipts for future reimbursement, a strategy we detail in our Health Savings Account Emergency Fund How-To article.

Key Dates in the History of the Health Savings Account in the United States

• 2003
Medicare Prescription Drug, Improvement, and Modernization Act passed, allowing Health Savings Accounts to be created and setting the initial contribution limit of HSAs at $2,600 for a single or$5,150 for a family.
• 2004
IRS clarifies that health spending incurred after an HSA is established can be reimbursed from a Health Savings Account at any point in the future.
• 2011
The Patient Protection and Affordable Care Act disallows over the counter purchases of medicines and drugs from Health Savings Accounts.
• 2018
In mid-2017, the IRS released guidance that the total family HSA contribution limit would be $6,900. They reversed that decision in early 2018, setting the limit to a lower$6,850. However, after a number of employers and plan administrators complained, the IRS reversed their reversal and set the HSA limit back to \$6,900.

Historical Sources on the Health Savings Account Limit

Limits in deductibles for eligibility were all sourced from IRS bulletins, 2004 to present. Here is the source for 2004. The limits come from Wikipedia.

PK

PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK is in his mid-30s and works and lives in the Bay Area with his wife, two kids, and dog.