Maryland Law Jeopardizes the Benefits of Health Savings Account Plans in Maryland

Maryland Law Jeopardizes the Benefits of Health Savings Account Plans in Maryland

Maryland law, effective January 1, 2018, requires Maryland health plans to cover 100% of the cost of male sterilization, which is in direct conflict with high deductible health plans (HDHPs).  HDHPs have a higher annual deductible than typical health plans.  The new Maryland law invalidates HSAs (Health Savings Accounts) in Maryland as of January 1, 2018, because HSAs work in conjunction with HDHPs under federal law (federal and Maryland law are in conflict).  Individuals insured through an HDHP are not eligible to contribute to their health savings accounts (individually or through their employer), as the contribution would not receive its intended tax-advantaged status and most likely would be subject to a penalty.

Maryland is currently attempting to pass emergency legislation, under SB 137, which may help to resolve this issue going forward upon Governor Hogan’s signature.  But this legislation, if passed, would very likely not be retroactive to January 1.

Please consult your HSA/health insurance provider for more information on this issue.

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The Cultural Alliance of Greater Washington has worked with Bormel, Grice & Huyett, P.A., since 1988. Their knowledge of the arts and the arts community make their services invaluable. They can translate accounting terminology into a comprehensive language. For many organizations, the accounting firm of Bormel, Grice & Huyett provides the financial "information bridge." We whole-heartedly recommend Bormel, Grice & Huyett, excellent accountants who care about our arts organizations.
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