A member of the House Ways and Means Committee is introducing a bill that would let workers use cafeteria plan and flexible spending account funds to pay for long term care insurance.
The Long-Term Care Affordability and Security Act of 2007, proposed by Rep. Earl Pomeroy, D.-N.D., would eliminate the rules that now shut LTC insurance out of cafeteria plans and FSAs.
Cafeteria plans enable employees to exclude income used to pay for voluntary benefits from taxable income.
FSAs give employees the ability to set aside cash to cover dental care, out-of-pocket health care costs and dependent day care. Workers can exclude the FSA contributions from their taxable income.
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Pomeroy expects to introduce his bill this afternoon, a Pomeroy spokeswoman says.