House Passes Legislation to Improve HSAs
The House of Representatives passed two pieces of legislation that, among other things, purport to improve and “modernize” health savings accounts (HSAs). While the bills call for significant changes to the current rules affecting HSAs, the specific details are very different. Both bills have been sent to the Senate for consideration.
Essentially the bills purport to:
- Allow primary care service arrangements, allowing for reimbursement up to a certain amount for primary care services
- Permit HSA eligibility when an individual has access to certain qualified items & services, such as physical examinations, immunizations, drug tests, etc., in connection with employment
- Allow employees to remain HSA eligible when they have access to a spouse’s Flexible Spending Account (FSA)
- Create flexibility for FSAs/Health Reimbursement Accounts (HRAs) to fund HSAs for the remainder of the year
- Allow reimbursements for purposes of HRA, HSA, and FSA for certain menstrual care products and qualified sports and fitness expenses up to a certain amount
- Expand HSA eligibility to age-based Medicare Part A eligible individuals
- Increase HSA annual maximums to match the out-of-pocket (OOP) of the high-deductible health plan (HDHP)
- Permit both spouses to make catch-up contributions
- Permit bronze & catastrophic plans to qualify has HDHP for HSA eligibility
- Permit reimbursement of expenses incurred within 60 days prior to the establishment of the HSA
- Increase the health FSA carryover amount from $500 to the remaining amount in the year, up to a certain amount
While both pieces of legislation have passed in the House, they still must go through the Senate. Whether the Senate will approve the bills “as-is” remains to be seen. Stay tuned to USIMetro.com or your USI Northeast consultant for further developments.