HSAs Receive a Major Opportunity From Congress
New Improvements Allow Consumers to Plan for Future Health Care and Long-term Care Needs
WASHINGTON, Dec. 11 -- Millions of consumers will have access to a more flexible health savings account (HSA) as part of their health insurance coverage in 2007 thanks to key legislative improvements enacted at the end of the 109th Congress. The passage of the legislation marks the successful conclusion of a two-year campaign by America's Health Insurance Plans (AHIP) to encourage policymakers to build on the success of HSAs with common-sense improvements.
The legislation as passed would increase the contribution limits for all individuals, eliminate contribution penalties for mid-year enrollees and allow consumers to convert existing health reimbursement arrangements (HRAs) and flexible spending arrangements (FSAs) into HSAs.
"Congress has given HSAs a major opportunity," said Karen Ignagni, President and CEO of AHIP. "Millions of consumers who are enrolled in HSA- eligible plans will go into the new year with more flexibility in their plans."
Ignagni said the increased contribution limits can equip consumers with the additional tax-free resources they need to meet their current and long- term health care needs.
"If you want consumers to prepare for long-term care, they need to develop a long-term strategy," Ignagni said. "With higher contribution limits that are indexed to inflation, HSAs will offer new opportunities for consumers to plan for their long-term care expenses."
Ignagni stressed that the bipartisan support needed to accomplish these improvements creates an opportunity to build on these accomplishments in the coming Congress by:
* Allowing HSAs to cover preventive and maintenance drugs before the deductible is met;
* Allowing HSA dollars to be used to purchase Medigap coverage;
* Allowing family policies to have lower individual deductibles for each family member within their HSA plan; and
* Allowing for greater coordination of HSAs, FSAs and HRAs.
America's Health Insurance Plans -- Providing Health Benefits to More Than 200 Million Americans