The House Ways and Means Committee approved legislation on September 28 that would allow more individuals to save for and afford health care costs by expanding contribution limits for health savings accounts (HSAs) and expanding eligibility requirements.
Under the Bipartisan HSA Improvement Act of 2023 and the HSA Modernization Act of 2023, more Americans can establish and contribute to an HSA without facing “outdated bureaucratic barriers and red tape that have stood in the way,” wrote the committee in a release.
“Our committee has been focused on helping working families and that includes making health care more affordable and accessible…”
Jason Smith, Ways and Means Committee
“Our committee has been focused on helping working families and that includes making health care more affordable and accessible…” said Ways and Means Committee Chairman Jason Smith, in a statement following the vote.
“Many of the solutions included in these bills reflect basic common sense like ending the marriage penalty that currently bars married couples from combining their HSA contributions into a single account, ensuring eligibility of direct primary care arrangements and worksite clinics, and allowing folks to save an amount that will actually cover what they might owe in out-pocket-expenses,” he continued.
The Bipartisan HSA Improvement Act of 2023 was sponsored by Reps. Earl Blumenauer and Lloyd Smucker, and the HSA Modernization Act of 2023 was sponsored by Rep. Beth Van Duyne.
HSA Modernization Act
One of the key provision changes in the legislation would increase the contribution limits for individuals participating in an HSA, to better align with what an individual might owe in total out-of-pocket expenses and deductibles. Spouses would also be able to add catch-up contributions into the same HSA, rather than having to establish a separate account.
The legislation also expands eligibility requirements among individuals, including veterans receiving care through the Veterans Administration, working seniors on Medicare, Native Americans, and those enrolled in certain health benefit exchange plans, reported the Committee.
Other provisions include allowing the use of an HSA to cover health care services performed up to 60 days prior to the establishment of the account, and increased access to mental health and health home services for those contributing to an HSA.
Bipartisan HSA Improvement Act
Under the Bipartisan HSA Improvement Act, individuals who utilize health services like direct primary care arrangements and worksite health clinics can use their own resources to contribute to HSA funds, and may also transfer flexible spending account (FSA) or health reimbursement arrangement dollars into an HSA.
Additionally, the new provisions eliminate a previous rule that had forbidden individuals to open an HSA if their spouse already had an existing flexible spending account.
SEE ALSO:
- HSA Assets on the Rise For Midyear 2023
- HSA Contribution Limits Get Biggest-Ever Boost for 2024
- HSA Bank Introduces Tuition Reimbursement Solution
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
