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Bill With HSA Provisions Heads To White House

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Congress completed work Saturday on a bill that could help consumers shift unused flexible spending account funds into health savings accounts.

The Senate voted 79-9 to pass the bill, H.R. 6111, and the House approved the bill by a 367-45 vote.

Officials of the American Benefits Council, Washington, say they expect the president to sign the bill “shortly.”

The HSA provisions were taken from a bill passed by the House Ways and Means Committee in September.

The HSA provisions permit holders of FSAs, health reimbursement arrangements and individual retirement plans to make one-time transfers of account funds into HSAs.

Other provisions would remove deductibles as caps for HSA contributions, let employers make full HSA contributions for employees who join HSA programs mid-year, and take highly compensated employees out of the comparison group for HSA contribution comparability testing for non-highly compensated employees.

Other sections of the long, catch-all bill make a number of changes to the Medicare and Medicaid programs and extend many programs and tax breaks, such as energy conservation tax credits.

Rep. William Thomas, R-Calif., outgoing chairman of the House Ways and Means Committee, put the HSA provisions in the bill as one of his last acts before ceding control of the Congress to the Democrats.

Employers, health insurers and brokers, and banks all lobbied hard for the bill, fully aware that Reps. Charles Rangel, D-N.Y., Ways and Means chairman-designate, and Pete Stark, D-Calif., chairman-designate of the committee’s health subcommittee, are opposed to HSAs and may be unlikely to pass bills offering improvements to them.

John Greene, vice president of congressional affairs at the National Association of Health Underwriters, Arlington, Va., says the H.R. 6111 provisions adjusting HSA accounts “will make administration of HSAs easier for employers and consumers alike.”

“The ultimate beneficiaries of these amendments are the consumers covered by [high-deductible health insurance plans and health savings accounts,” says Alycia Kiley, director of government affairs at the Council of Insurance Agents and Brokers, Washington.

Although the CIAB “is supportive of all of the provisions included the bill, brokers are primarily thankful for the consideration of the mid-year enrollment issue,” Kiley says. “This has been a lobbying priority for both council members and their employer clients for the past 2 years.”

The HRA-to-HSA will be a big help to employees, because HSA are far more portable than HRA assets, Kiley says.

A copy of the House amendment to H.R. 6111 that includes the HSA provisions is on the House Rules Committee Web site, at Document Link