If your company renews its group health plan on January 1, the next few weeks are when plan designs get locked in, enrollment materials get drafted, and payroll gets set up for the new year. That makes this a good moment to check the numbers behind your tax-advantaged accounts. Health savings accounts (HSAs), health flexible spending arrangements (FSAs), and health reimbursement arrangements (HRAs) all have limits that are adjusted for inflation, and several of the 2027 figures are already set. Here is what has changed, what is still pending, and what a small employer should actually do about it.
The 2027 HSA and HDHP numbers are final
The IRS released the 2027 HSA and high deductible health plan (HDHP) figures in Revenue Procedure 2026-24 this spring. For 2027, an employee with self-only HDHP coverage can contribute up to $4,500 to an HSA, up from $4,400 in 2026. The family limit rises to $9,000, up from $8,750. Employees who are 55 or older by the end of the year can still add a $1,000 catch-up contribution, which is not indexed and stays the same.
Keep in mind that these limits include both employee and employer money. If your company puts $1,000 into each employee’s HSA, a family-coverage employee can defer up to $8,000 through payroll in 2027, not $9,000. This is one of the most common sources of over-contribution, and it is worth making clear in your enrollment materials.
For a plan to qualify as an HDHP in 2027, the deductible must be at least $1,750 for self-only coverage and $3,500 for family coverage, up from $1,700 and $3,400. The out-of-pocket maximum cannot exceed $8,700 for self-only coverage or $17,400 for family coverage. If your current HSA-qualified plan has a deductible sitting right at the 2026 minimum, confirm with your carrier that the 2027 version of the plan has been adjusted. A plan that falls below the new minimum is no longer HSA-compatible, and employees enrolled in it would lose the ability to contribute.
Health FSA limits are expected soon
The IRS usually announces health FSA limits in October or November. Consulting firm Marsh (formerly Mercer) projects that the 2027 salary-reduction limit will rise to $3,500 from $3,400, and that the maximum carryover amount will rise to $700 from $680. Those are projections, not official figures, so it is reasonable to prepare communications using them as placeholders but wait for the IRS announcement before finalizing payroll and plan documents.
If your FSA uses the carryover feature, remember that the plan document sets your actual carryover amount. The IRS figure is only the ceiling. Some employers leave their plan at an older, lower amount without realizing it, which can lead to confusion when employees read about the higher limit elsewhere.
Excepted benefit HRAs get a small bump
For plan years beginning in 2027, the maximum an employer can offer through an excepted benefit HRA rises to $2,250, up from $2,200. This type of HRA lets an employer reimburse certain expenses, such as dental, vision, or short-term plan premiums, for employees who are offered the group health plan, even if they decline it. It is a niche tool, but it can help employers who want to offer something to employees who waive medical coverage.
Other HRA types work differently. An individual coverage HRA (ICHRA) has no federal dollar cap; the employer sets the allowance. A qualified small employer HRA (QSEHRA), available only to employers with fewer than 50 full-time equivalent employees who do not offer a group health plan, has its own annual limit. In 2026 that limit is $6,450 for self-only and $13,100 for family coverage, and the 2027 figures are usually published later in the year.
Recent law changes that affect HSA plan design
The One Big Beautiful Bill Act, signed in 2025, made several HSA-related changes that matter for plan design in 2027. The most relevant for group plans is that the safe harbor allowing HDHPs to cover telehealth before the deductible is now permanent, retroactive to plan years beginning after December 31, 2024. If your plan dropped pre-deductible virtual care when the earlier temporary relief expired, you may want to ask your carrier or administrator about adding it back.
The law also allows employees enrolled in a qualifying direct primary care arrangement to stay HSA-eligible, as long as the monthly fees stay within set limits. For 2027, those limits remain $150 per month for self-only coverage and $300 per month for family coverage. Separately, bronze and catastrophic plans purchased through an ACA exchange are now treated as HSA-compatible. That change applies to individual market coverage rather than employer group plans, but it can come up if you offer an ICHRA and employees buy their own exchange coverage.
A practical checklist for the next few weeks
Start by confirming the 2027 deductible and out-of-pocket figures on any HSA-qualified plan in your renewal. Then review how much, if anything, the company contributes to employee HSAs or FSAs, and whether that amount still makes sense against the new limits and your budget. Update your payroll or benefits administration system so that employee elections cannot exceed the 2027 caps, and make sure your enrollment guide explains that employer contributions count toward the HSA limit.
It is also worth thinking about how you present these accounts to employees. Many employees underuse HSAs because they see them only as a way to pay this year’s bills rather than as a long-term savings account that can be invested and carried from job to job. A short explanation during open enrollment, with the actual 2027 dollar figures, can help employees make better elections without adding cost to the company.
Finally, if you are weighing whether to add an HSA-qualified plan, change your FSA design, or offer an HRA for the first time, bring those questions to your broker or benefits advisor before your renewal deadline rather than after. These decisions are much easier to make while plan designs are still open.
Sources
- The Wagner Law Group: IRS Announces 2027 HSA, HDHP and HRA Limits
- IRS Revenue Procedure 2026-24
- SHRM: IRS Unveils 2027 HSA, HDHP Limits
- Marsh: Projected 2027 Transportation and Health FSA Limits
- PeopleKeep: 2026 QSEHRA Contribution Limits
- IRS: Treasury, IRS Guidance on New HSA Tax Benefits Under the One, Big, Beautiful Bill
- WEX: What the One Big Beautiful Bill Act Means for HSAs and FSAs
This post is general information only and is not legal, tax, or insurance advice. Contribution limits and plan rules can change, and your situation depends on your specific plan documents. Please review your actual plan materials and talk with a licensed insurance agent, benefits advisor, or tax professional before making decisions.