Utah Rep. Blake Moore has introduced proposed legislation into the 118th Congress that would help Americans take full advantage of their Health Savings Accounts. That proposal would establish a special rule for qualified medical expenses incurred prior to the establishment of a health savings account.
WASHINGTON. D.C. – Amid all the recent drama on Capitol Hill here about the abortive government shutdown, Rep. Blake Moore (R-UT) has quietly introduced legislation to help all Americans take full advantage of their Health Savings Accounts.
“The Advancing Health Savings Act is a commonsense reform measure that will give patients peace of mind in knowing they have access to the saving afforded by HSA’s for certain medial expenses incurred before they could establish those (savings accounts),” Moore explained in late September.
A health savings account (HSA) is type of savings account that lets health care consumers set aside money on a pre-tax basis to pay for qualified medical expenses.
By using untaxed dollars in an HSA to pay for deductibles, copayments, coinsurance and some other expenses, consumers may be able to lower out-of-pocket health care costs.
While the funds in an HSA can be used at any time to pay for qualified medical expenses, patients can contribute to an HSA only if they have an HSA-eligible plan, which is sometimes called a High Deductible Health Plan (HDHP).
An HSA may earn interest or other earnings, which are not taxable. Many employers, banks, credit unions and other financial institutions offer HSA’s to their employees and members as part of health care coverage plans.
Moore’s proposed legislation would establish a special rule for qualified medical expenses incurred prior to the establishment of a health savings account.
Under his proposal, if an HSA were established within 60 days of the effective coverage date for an high deductible health plan, an individual could use distributions from their HSA to pay for qualified medical expenses incurred during the 60-day between the dates when their HDHP coverage began and the time that their HSA was established.
“These accounts are designed to empower patients to lower their health care costs and save tax-free for future medical needs,” Moore said after introducing his Advancing Health Savings Act on Sept. 26.
By reducing the impact of that 60-day waiting period for a patient’s HSA to take effect, the Advancing Health Savings Act will do just that.
“This legislation will bolster consumers’ ability to used these tax-advantaged accounts to reduce the cost of their care,” he added.
Moore’s proposed legislation is supported by numerous national and Utah-based consumer organizations.
At a national level, Moore’s advocates include Health Savings Account Council of the American Bankers Association, the Employers Council on Flexible Compensation, the Health Savings Account Council and the ERISA Industry Committee.
That latter organization protects retirement savings and health benefits from mismangement and abuse on a national level. About 54 percent of America’s workers earn retirement benefits on the job and 59 percent earn health benefits.
ERISA encompasses roughly 684,000 retirement plans, 2.4 million health plans and 2.4 million additional welfare benefit plans.
These plans cover about 141 million workers and beneficiaries, plus more than $7.6 trillion in assets.
Here in Utah, the Advancing Health Savings Act has been endorsed by the Cache Valley Chamber of Commerce, the Ogden-Weber Chamber of Commerce, the Park City Chamber of Commerce, the Salt Lake Chamber of Commerce, the Utah Association of Certified Public Accountants, the Utah Bankers Association, the Utah Hospital Association and the Utah Taxpayers Association.