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Health Savings Account legislation passes House
Health Savings Account legislation recently passed in the U. S. House of Representatives will make the HSA even more attractive to employees and valuable to employers — if it can get through the Senate. Read on to learn more on how HR 6311 and HR 6199 would expand, restore, and improve HSA options.
Business owners cheer House passage of HR 6311 and HR 6199, Health Savings Account legislation to restore and expand cost-management choices in health care.
HR 6311 — Increasing Access to Lower Premium Plans and Expanding Health Savings Accounts Act of 2018
If passed by the Senate and signed into law by the President, this bill will expand the usefulness of an HSA by allowing account owners (individual and employer-sponsored) to contribute an annual amount equal to the maximum out-of-pocket (deductible and co-pay) allowance.
Here is how those annual limits are currently set: For 2019, the maximum contribution limit rises to $3,500 for individuals and $7,000 for family coverage. The maximum out-of-pocket allowance increases to $6,750 and $13,300, respectively. That’s nearly twice the amount HSA owners are allowed to contribute in pre-tax dollars to cover eligible out-of-pocket medical expenses.
HR 6311 would raise the HSA pre-tax contribution limit to equal the out-of-pocket maximum. That could mean an additional $1,000 in tax savings for individuals contribution the maximum in 2019 and twice that for families.
For employers sponsoring the HSA in a Section 125 plan, the additional tax savings could be $250 to $500, respectively, for every employee making the additional allowed contributions.
HR 6311 also allows greater carryover for health Flexible Spending Accounts (FSAs) and qualifies lower-cost copper and catastrophic insurance plans to accompany HSAs.
Click here to read a full summary of HR 6311.
HR 6199 — Restoring Access to Medication and Modernizing Health Savings Accounts Act of 2018
Pending passage in the Senate and the President’s signature, HR 6199 will allow HDHPs associated with HSAs to offer first-dollar coverage up to $250 for individual coverage and $500 for families. This will make it more likely that covered individuals take advantage of preventative care services that reduce health coverage costs overall.
The bill will also allow employers greater flexibility in the way they allow employees to apply FSA and HRA rollover funds into an HSA balance. It also lets both spouses contribute a catch-up provision amount to the same HSA.
There are also provisions calling for a restoration of over-the-counter medication coverage that was eliminated with the ACA (aka Obamacare) along with expanding HSAs to cover physical fitness expenses up to $500 per individual, per year ($1,000 for individual plus spouse).
Click here to read a full summary of HR 6199.
Encourage your Senator on Health Savings Account legislation
It is uncertain whether or not the Senate will pick up this legislation in the current legislative year. While both houses of Congress want to expand HSAs, the Senate has its own priorities and a Supreme Court nominee to clear.
If you want to encourage the Senate to vote on these bills already passed by the House, contact your senator today. Whether you choose regular mail, email, or phone, you can find all of the information you need on the Senate’s official contact page.