New law ups HSA contributions

WASHINGTON, Dec. 12 (UPI) -- People choosing health saving accounts can now put more money into the accounts, due to legislation passed as U.S. Congress wrapped up.

The legislation slipped through in the waning hours of the 109th Congress increases the limits on contributions to HSA accounts, eliminates contribution penalties for mid-year HSA enrollees and also permits consumers to convert their existing health reimbursement arrangements and flexible spending arrangements into HSAs.

Applauding the new rules, Karen Ignagni, president and chief executive officer of insurance industry trade group America's Health Insurance Plans, said in a statement, "Congress has given HSAs a major opportunity. Millions of consumers who are enrolled in HSA-eligible plans will go into the new year with more flexibility in their plans."

The group said it had lobbied congressional lawmakers for the past two years to increase HSAs' flexibility.