Government

Legislation introduced to reverse limitations on FSAs and HSAs imposed by PPACA

Senator Kay Bailey Hutchison of Texas

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The following information has been released by the American Benefits Council (see link to their website). This will come as welcome news for millions of Americans trying to manage their personal health care expenses.

Lawmakers in the U.S. Senate and House of Representatives have introduced the Patients’ Freedom to Choose Act, which is legislation to repeal the eligibility limitations on Health Savings Accounts (HSAs) and Flexible Spending Arrangements (FSAs) that were enacted as part of the Patient Protection and Affordable Care Act (PPACA). The Senate legislation (S. 312) was introduced by Senator Kay Bailey Hutchison (R-TX) and the House bill (H.R. 605) was introduced by Representative Erik Paulsen (R-MN).
 
On January 1, 2011, a provision in PPACA took effect that prohibited individuals from using funds from either Health Savings Accounts (HSAs) or Flexible Spending Accounts (FSAs) to purchase over-the-counter medication without a prescription from their doctor. Starting in 2013, PPACA institutes a $2,500 federal cap for all FSA contributions.
 
S. 312/H.R. 605 repeals the new cap on FSA contributions by striking the $2,500 restriction and it also repeals the provision that requires patients using HSAs or FSAs to have a prescription from their doctor before they purchase over-the-counter medication.

Note: These changes made by PPACA were estimated to save the government $18 billion over ten years (and take it from workers).  While those estimates are highly questionable, the $18 billion additional expense is very likely to be raised in any discussion about this legislation.

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Categories: Government, Healthcare

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