NU Online News Service, Dec. 23, 2003, 12:37 p.m. EST – The U.S. Office of Personnel Management says it is looking into the possibility of incorporating the new health savings accounts into the Federal Employees Health Benefits Program.[@@]
A section near the end of H.R. 1, the bill that created the Medicare Prescription Drug, Improvement and Modernization Act of 2003, makes HSAs available to taxpayers who have certain kinds of high-deductible health coverage.
Eligible taxpayers with family coverage can deduct up to $5,150 in HSA contributions, roll over HSA assets at the end of the year and withdraw HSA assets to pay for qualified health care expenses without paying federal income taxes on the distributions.
Qualified expenses include long term care insurance premiums as well as routine out-of-pocket medical expenses.
Offering HSAs to federal employees will give employees more control over health care expenditures, according to OPM Director Kay Coles James.