Representative Brady Separates Health Savings Accounts from Pending New Tax LegislationImage Banner

Representative Brady Separates Health Savings Accounts from Pending New Tax Legislation

You are here

Representative Brady Separates Health Savings Accounts from Pending New Tax Legislation

June 18, 2018

According to Lexology:

“House Ways and Means Chairman Kevin Brady announced plans to expand health savings accounts (HSAs) via a standalone bill, apart from the Tax Reform 2.0 effort.

The new HSA legislation will build off on changes passed by the House last year, allowing HSA funds to be used to purchase over-the-counter medicine. The package may include policies to expand Consumer Directed Health Plans and raise contribution limits.

Brady’s decision to move the HSA bill separately may signal a more bipartisan approach. Though, during last week’s health subcommittee hearings, several Democrats expressed skepticism that expanding HSAs would help drive down healthcare costs for consumers.”

This issue may be of particular interest to ANCOR members because the increase in contribution limits to HSAs could have a positive impact on people with disabilities—funds saved in HSAs are not taxed as income. Additionally, ANCOR has been monitoring the discussion around tax reform to ensure that it does not use cuts to Medicaid programs to pay for the tax cuts for wealthy individuals and corporations passed at the end of 2017. So far, such cuts to Medicaid have not been proposed and, as we discuss elsewhere in this issue of Capitol Correspondence, we are seeing a potential shift away from entitlement reform in the Senate that could chill such proposals.