High Deductible Health Plans (HDHPs) paired with Health Savings Accounts (HSAs) remain a cornerstone of modern benefits strategy. When executed correctly, they offer a powerful “triple tax advantage” for employees and lower premiums for employers. However, the federal rules governing these accounts are strict.
As we move into the 2026 plan year—and navigate new permanent changes brought on by the One Big Beautiful Bill Act (OBBBA)—it is critical for employers to audit their compliance to avoid costly excise taxes and employee relations issues.
Verify Your HDHP Status (2026 Limits)
To be HSA-eligible, a health plan must meet specific IRS definitions for “High Deductible.” For plan years beginning in 2026, ensure your plan design matches these updated thresholds:
Crucial Check: If your family plan uses “embedded” deductibles, the individual deductible within the family plan cannot be lower than the family minimum of $3,400.
Prevent FSA/HRA Disqualification Issues
An employee is generally ineligible to contribute to an HSA if they are covered by a general-purpose Flexible Spending Account (FSA) or Health Reimbursement Arrangement (HRA).
The Grace Period Risk: If an employee has a remaining balance in a general-purpose FSA with a grace period, they cannot contribute to an HSA until the grace period ends.
The Carryover Solution: To preserve HSA eligibility, employers should allow employees to either waive their FSA carryover or transition those funds into an “HSA-compatible” (Limited Purpose) FSA.
Master the 2026 Contribution Limits
While employees are responsible for their own tax filings, employers play a vital role in preventing “excess contributions” through payroll.
Age 55+: Catch-up contributions remain a vital tool but require careful tracking.
Correction Window: If a mistake is made, employees must distribute the excess funds by April 15 of the following year to avoid a cumulative 6% excise tax.
Special Alert: Medicare and Age 65
Medicare eligibility is a common source of HSA compliance errors. Once an individual enrolls in any part of Medicare, they can no longer contribute to an HSA.
The Retroactive Rule: If an employee applies for Medicare more than six months after turning 65, their coverage (and HSA ineligibility) may be backdated up to six months.
Employer Action: Inform employees approaching age 65 to plan their “contribution stop date” carefully to avoid unintended tax penalties.
Leverage Permanent Telehealth Flexibility
Because of the OBBBA (Notice 2026-5), the temporary “safe harbor” for telehealth has been made permanent. HDHPs can now provide first-dollar coverage for telehealth and remote care services before the deductible is met without disqualifying the HSA.
Why this matters: Incorporating pre-deductible telehealth reduces time away from work, increases productivity, and lowers overall claims costs by catching minor issues before they require an ER visit.
Work and family are two of the most important parts of an employee’s life. But starting or growing a family doesn’t always happen easily. According to the World Health Organization, about one in six people experience fertility challenges, making the path to parenthood stressful, complex and often expensive. Not surprisingly, these challenges can spill over into the workplace. Research shows that many employees spend time during work hours exploring treatment options and benefits, and more than half report that fertility struggles have negatively affected their job performance.
Fertility-related stress is a key driver of presenteeism—when employees are physically at work but less productive due to personal concerns. This not only affects morale and engagement but also carries a significant financial cost. Estimates suggest presenteeism costs U.S. businesses far more than absenteeism each year. Employers that offer fertility benefits often see higher engagement, improved productivity and stronger long-term retention.
Understanding Infertility
Infertility has been classified as a disease since 2017 and is generally defined as the inability to conceive after a year of trying without contraception. It affects both men and women and is often difficult to detect because symptoms aren’t always obvious.
Primary vs. Secondary: Whether an employee is trying for their first child or adding to their family, also known as secondary infertility, the stress remains the same.
Medical Drivers: Common reasons for seeking care include ovulation disorders, uterine fibroids, endometriosis, genetic screening, and fertility preservation, such as before chemotherapy.
Because these conditions affect employees throughout various life stages, employers who offer fertility coverage can appeal to a wide demographic and enhance retention across their workforce.
The Financial Reality of Care
The “financial toxicity” of infertility is a major stressor for the workforce:
Price Tag: A single IVF cycle can exceed $30,000, yet only 32% of individuals can afford treatment without assistance. Multiple cycles are often required to achieve pregnancy.
Debt & Sacrifice: To afford care, employees often go into significant debt, dip into retirement savings, or take second jobs—all of which fuel workplace burnout and distraction.
Common Benefit Offerings
Employers can leverage several strategies to support their team, depending on budget and goals:
Clinical Procedures: Covering IVF, such as egg retrieval and transfer, or IUI, also known as artificial insemination.
Surgical Interventions: Procedures to resolve physical barriers like cysts or fallopian tube issues.
Pharmaceutical Support: Medications to stimulate ovulation or improve counts.
Navigation & Coaching: Providing access to specialized platforms to help employees find high-quality, cost-effective care.
Why Fertility Benefits Matter
Because most states do not mandate fertility coverage for private insurers, employer-sponsored fertility benefits can make a meaningful difference. They reduce financial stress and promote emotional well-being.
Fertility challenges can take a toll on employees’ emotional well-being, finances and job performance. By offering meaningful fertility benefits, employers can reduce these burdens while improving productivity, engagement and satisfaction. At the same time, these benefits help organizations stand out in a competitive labor market, supporting both talent attraction and long-term retention.
Choosing a health insurance plan can feel a lot like solving a puzzle—there are many moving pieces, and the best fit depends on how they come together for your unique situation. With so many options and acronyms—HMO, PPO, POS, EPO, HDHP—it’s easy to feel unsure about where to start. This guide breaks down the most common types of health plans to help you understand how they work, what they cost, and which one might align best with your health care needs and budget.
What Sets Health Plans Apart
When comparing plans, pay attention to these key differences:
Whether you must choose a Primary Care Provider (PCP)
If you need referrals to see specialists or get certain services
Whether the plan requires preauthorization for certain procedures
If out-of-network care is covered
How much cost sharing you’re responsible for (deductible, copay, coinsurance)
Whether you’ll need to file claims or handle additional paperwork
No single plan works for everyone. The right choice depends on your personal health needs, your family’s situation, and your financial comfort level.
Health Maintenance Organization (HMO)
An HMO plan typically offers lower premiums, smaller deductibles, and predictable copays. In exchange, you’ll need to stay within the plan’s provider network and work through a designated PCP, who must refer you to specialists.
HMOs can be a cost-effective option for individuals with fewer health care needs who are comfortable with a structured system.
Preferred Provider Organization (PPO)
PPO plans allow more flexibility when choosing health care providers—you can see specialists and even out-of-network doctors without referrals. These plans usually have higher premiums, and out-of-network care costs more.
A PPO may be a good fit if you want freedom to choose your providers and anticipate needing multiple types of care.
Point-of-Service (POS)
POS plans blend features of both HMOs and PPOs. You’ll select a PCP but can also choose out-of-network care at a higher cost. For slightly higher premiums than an HMO, POS plans provide flexibility while encouraging coordinated care through your PCP.
A POS plan can work well if you want both structure and the occasional freedom to go out-of-network.
Exclusive Provider Organization (EPO)
An EPO plan offers moderate flexibility. Like an HMO, you must use in-network providers, but unlike an HMO, you usually don’t need a referral to see a specialist. Premiums fall between HMO and PPO rates.
An EPO might be right for you if you’re comfortable with a limited provider network and want easier access to specialists.
High Deductible Health Plan (HDHP)
An HDHP can be structured as an HMO, PPO, POS, or EPO. These plans feature lower premiums but higher deductibles—meaning you’ll pay more upfront before coverage kicks in. HDHPs are often paired with a Health Savings Account (HSA), which lets you set aside pre‑tax dollars for medical expenses and roll over unused funds year to year.
HDHPs can work well for those who don’t anticipate frequent medical needs, such as younger or healthier individuals, but they may not be ideal for those with ongoing health concerns.
Final Thoughts
Because health plans and rules can vary by state (and employer), take time to review the details carefully before enrolling. Understanding the coverage, costs, and flexibility of each option will help you make an informed, confident decision that fits your unique health and financial needs.
Offering voluntary benefits is an excellent way to strengthen your overall benefits package, stand out from competitors, and enhance employee satisfaction—all with minimal impact on your budget. However, while employers often provide a wide range of voluntary benefits designed to offer value and convenience, many employees may not fully understand what these benefits are or how they can help. Educating your workforce about the advantages of voluntary benefits ensures both employers and employees gain maximum value.
Showcasing the Value
Employees may not always recognize the value of voluntary benefits, particularly since these options are typically employee-funded. These benefits, which may include options like life insurance, disability coverage, accident insurance, critical illness insurance, cancer insurance or even legal and pet insurance, provide added security and convenience without significantly increasing employer costs.
For example, voluntary insurance purchased through an employer group is often more affordable than an individual policy—but few employees realize this. When highlighting voluntary benefits, clearly explain the advantages of being covered, the potential risks of going without protection, and the convenience of enrolling through payroll deductions.
Promoting Coverage Understanding
Employee education is vital to preventing confusion and frustration about what a policy covers. Misunderstandings can lead to resentment if employees expect coverage that isn’t actually included. To avoid these situations, ensure every employee—whether their benefit is employer-paid or voluntary—understands how the coverage works.
Consider the following strategies to strengthen benefits education:
Invite current employees to attend orientation or periodic benefits meetings.
Ask benefit providers to send representatives to explain their products directly to staff.
Schedule small-group sessions for employees who have detailed questions.
Leverage social media to share educational materials, reminders, and benefit updates in an accessible way.
Strengthening Employer Value
Beyond increasing participation in voluntary benefits, investing in employee education helps position your organization as a trusted source of benefits knowledge. This approach not only boosts engagement but also strengthens employee satisfaction and loyalty to your company.
The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025, introducing significant updates to Health Savings Accounts (HSAs). Following this, the IRS released Notice 2026-5 to provide specific guidance on how these changes expand HSA eligibility and usage.
The OBBBA broadens HSA availability through the following key provisions:
1. Permanent Telehealth Flexibility
The ability to receive telehealth and other remote care services before reaching the High Deductible Health Plan (HDHP) deductible has been made permanent. This ensures that individuals can access remote care without losing their HSA eligibility. This extension is effective for all plan years beginning after December 31, 2024.
2. Integration with Direct Primary Care (DPC)
The new law officially recognizes Direct Primary Care (DPC) arrangements as compatible with HSAs.
Individuals in these arrangements can now contribute to an HSA.
Periodic DPC fees are now classified as qualified medical expenses, meaning they can be paid for using tax-free HSA funds.
3. Expanded Plan Compatibility
Bronze and catastrophic plans offered through the ACA Exchange are now designated as HSA-compatible. This change applies regardless of whether these specific plans meet the traditional IRS requirements for an HDHP, significantly increasing the number of Americans eligible to open and fund an HSA.
Strategic Outlook for Employers
While some provisions are currently active, the majority of the OBBBA’s employee benefit changes will take full effect in 2026. Employers are encouraged to review these regulatory updates immediately to ensure benefit packages remain compliant and optimized for the coming year.
In our increasingly busy world, employee expectations are accelerating faster than ever before. A five-year-old benefits strategy simply cannot meet the complex, constant pressures workers face in 2026—be it financial stress, burnout, or caregiving responsibilities. The modern workforce is rejecting generic menus in favor of flexibility, strong financial support, and wellness options that align with their personal lives.
Employers face a critical challenge in 2026: balancing projected healthcare cost increases (around 10%) with the need to offer personalized, holistic, and competitive benefits.
Top 9 Trends Shaping 2026 Benefits Strategy:
Managing Rising Healthcare Costs: Employers are adopting cost-management tactics — such as telemedicine, HSAs, and wellness incentives — to balance rising expenses driven by medical inflation, specialty drug use, and delayed care demand.
Total Health and Well-Being:Benefits now integrate physical, mental, and financial wellness through EAPs, teletherapy, and wellness technology to promote holistic employee health.
Women’s Health Expansion: Comprehensive care from fertility to menopause is becoming standard, improving retention, equity, and workforce engagement.
Personalized Benefits Through AI:Technology enables tailored benefits selection, predictive analytics, and mobile access, meeting diverse employee needs.
Mental Health Integration:Behavioral health is now fundamental, with digital tools, manager training, and open dialogue reducing stigma and driving productivity.
Family and Caregiving Support:These benefits address the financial and emotional strain on the “sandwich generation” (caring for children and elders simultaneously). Expanded parental leave, dependent-care FSAs, and eldercare resources address pressures on multigenerational caregivers.
Voluntary Benefits:Supplemental benefits provide a cost-effective way to offer additional value to employees. From pet insurance to identity theft protection, these benefits give employees the flexibility to select coverage that meets their individual needs.
Financial Wellness and Retirement Security:Initiatives like 401(k) matching, financial counseling, and student-loan repayment reduce stress and strengthen financial stability.
Upskilling and Development:Investing in employee growth as a key driver of retention and engagement, particularly among Gen Z and Millennials. Continuous learning opportunities, AI-driven training, and mentorship programs help attract and retain talent seeking career growth.
Ultimately, a strategic benefits plan that balances economic realities with genuine care for the workforce will be the decisive factor in attracting talent, boosting engagement, and building a resilient team ready for the year ahead.
