Congress recently passed two bills that could drastically expand the usage of HSAs.
If these bills become law, HR pros will have a lot to communicate to their staffers about the many ways in which they can now use their HSAs.
The bills, H.R. 6199 and H.R. 6311, are both Republican-backed bills with some Democratic support and would allow account-holders to use their HSAs for several things that are currently prohibited.
The Restoring Access to Medication and Modernizing Health Savings Account Act (H.R. 6199) passed by the greatest margin of the two bills (277-142).
Some of the more significant changes the legislation would make to HSAs (changes that are covered in much more detail in a recent article by the Society for Human Resource Management or SHRM):
- Undo the ACA’s ban on using tax-advantaged accounts to purchase over-the-counter medications and product.
- Allow individuals with HSA-qualifying family coverage to contribute to an HSA if their spouse is enrolled in a medical FSA, a move that currently isn’t allowed.
- Allow HDHPs to cover up to $250 (self-only) and $500 (family) annually for nonpreventive services that may not be covered pre-deductible. This would help workers, on a limited basis, use HDHPs to cover things like chronic-care treatment outside the deductible.
The Increasing Access to Lower Premium Plans and Expanding Health Savings Accounts Act (H.R. 6311) passed (242-176) would expand how low- and moderate-earners could use the ACA’s premium tax credit and:
- Raise the HSA contribution limit to $6,650 (individuals) and $13,300 (families), which is a combination of annual limit for out-of-pocket and deductible expenses for 2018.
- Allow HSA to pay for qualified medical expenses at the start of HDHP coverage if HSAs are opened within 60 days of HDHP start date.