Senator Orrin Hatch (R-UT), Ranking Member, Senate Finance Committee and Representative Erik Paulsen (R-3rd, MN) have introduced the “Family and Retirement Health Investment Act of 2011.” The legislation makes a number of changes to strengthen and expand health savings accounts (HSAs) and flexible spending accounts (FSAs). Specific provisions in the legislation would:
- allow a husband and wife to make catch-up contributions to the same HSA;
- remove the requirement that an individual have a physician’s prescription to obtain HSA or FSA reimbursement for OTC drugs;
- allow individuals to roll-over up to $500 from their FSA accounts;
- clarify the use of prescription drugs as preventive care that will not be subject to an HSA-eligible plan deductible;
- reauthorize the use of Medicaid health opportunity accounts;
- promote wellness by expanding the definition of qualified medical expenses to encourage more exercise and better diet;
- allow seniors enrolled in Medicare Part A to continue contributing to their HSAs; and
- allow for the purchase of low-premium health insurance and long-term care insurance with HSA dollars.
Kevin McKechnie, executive director, ABA’s Health Savings Account Council, said in a statement that the American Bankers Association and ABA’s HSA Council strongly support Senate and House versions of the Family and Retirement Health Investment Act of 2011.
McKechnie said, “The legislation seeks to correct oversights in the current HSA statute to make HSAs available to more Americans, particularly veterans, individuals eligible for TRICARE coverage and individuals that utilize Indian Health Services. It will also allow seniors to continue to save for future healthcare expenses by enabling Medicare beneficiaries enrolled only in Part A to continue to contribute to their HSA accounts after turning 65.”