Compliance May 10, 2024

Ann Orr Replaces Gordon Hartogensis as PBGC Acting Director

Hartogensis’ term expired at the end of April.

Reported by

Ann Orr was selected by President Joe Biden to be the acting director of the Pension Benefit Guaranty Corporation on May 3. Her predecessor, Gordon Hartogensis, departed when his five-year term expired on April 30.

The White House has not yet announced a nominee to be the new director and the PBGC did not respond to a request for comment on who the nominee might be.

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Orr has served as the PBGC’s chief policy officer since June 2021 and oversaw a portfolio of policy development and research, legislative affairs and communications. Prior to that position, Orr served as chief of staff at the PBGC for eight years and as a staff member for the Senate Committee on Health, Education, Labor and Pensions for ten years.

Michael Rae, previously the PBGC’s deputy chief policy officer, will perform the duties of chief policy officer while Orr serves as acting director.

The PBGC, in its November Annual Performance and Financial Report for 2023, reported that both of the pension insurance programs it maintains ended their fiscal years with positive net financial positions. The multiemployer program had a net positive position of $1.5 billion at the end of FY 2023, compared with $1.1 billion at the end of FY 2022. The single-employer program reported a positive net position of $44.6 billion at the end of FY 2023, compared with $36.6 billion at the end of FY 2022.

The positive balances of these programs have prompted some to suggest that private-sector pension insurance premiums could be reduced to make it more attractive for employers to offer defined benefit pensions to their employees.

Compliance May 10, 2024

IRS Increases HSA Contribution Limits

The new contribution limits take effect for 2025.

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The Internal Revenue Service issued inflation adjustments for 2025 for health savings accounts in connection with high-deductible health plans in Revenue Procedure 2024-25.

HSAs are accounts that can be funded with pre-tax contributions. The funds, which can be invested, then grow tax-free and can be distributed tax-free, provided they are spent on qualified medical expenses. HSAs are therefore said to be triple-tax privileged. In order to use an HSA, an employee must be enrolled in a high-deductible health plan.

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For 2025, high-deductible means “a health plan with an annual deductible that is not less than $1,650 for self-only coverage or $3,300 for family coverage.” This is an increase from $1,600 for self-only coverage and $3,200 for family coverage. A HDHP also must maintain a maximum out-of-pocket limit of $8,300 for self-only and $16,600 for family for 2025; an increase from $8,050 and $16,100, respectively.

The maximum HSA contributions also increased for 2025. For self-only coverage, an individual can contribute up to $4,300 annually or $8,550 for family coverage. The limits for 2024 had been $4,150 and $8,300, respectively.

Account holders 55 and older can contribute an additional $1,000 to either category.

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