The federal law governing the consumer driven option known as a health savings account (HSA) coupled with a high deductible health plan (HDHP) provides for annual inflation adjustments to the minimum and maximum health plan deductible, the out-of-pocket expense maximum, etc. The inflation adjustment for the next year is computed based on the change in the consumer price index (urban or CPI-U) from August of the prior year to August of the current year -- the same adjustment that is used for income tax factors that are inflation adjusted.
After the Department of Labor recently released the August 2006 CPI-U data, the HSA mavens quickly performed the calculation and projected the inflation adjusted HSA/HDHP factors for 2007. The IRS will release the official adjustments later this fall.
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