From the Hotline: Changing HSA Contributions Mid-Year
Question: Does an employer have to allow an individual to change his/her Health Savings Account (HSA) contribution mid-year?
Answer: An HSA must permit participants to change elections at least monthly, as eligibility is determined on a monthly basis, even if the HSA is provided through the cafeteria plan. However, the change must be prospective. This means they are not made retroactively, but rather a move-forward basis against salary not already earned.
The regulations do not specifically address the administrative procedures in this regard, and you can require changes to be remitted by “x” date to allow for administrative ease.