On May 3, 2005, Rep. Eric Cantor (R-VA), the Chief Deputy Majority Whip in the House, introduced a bill (HR 5262) that embraces the Health Savings Account / High Deductible Health Plan improvements that President Bush proposed in the year’s State of the Union address:
- Increasing HSA contribution limits to the plan’s out-of-pocket maximum;
- Making premiums for HSA-compatible insurance tax-deductible;
- Providing a low-income tax credit the purchase of HSA-compatible insurance;
- Allowing employers to make greater HSA contributions for chronically ill employees;
- Allowing flexibility to coordinate HSAs with existing health coverage options like Flexible Spending Accounts (FSAs) and Health Reimbursement Arrangements (HRAs);
- Allowing early retirees to use HSA savings to pay for insurance coverage premiums;
- Providing an income tax credit equal to amount of payroll taxes paid on HSA-compatible insurance premiums;
- Providing an income tax credit equal to the amount of payroll taxes paid on HSA contributions, and
- Providing pre-tax treatment of health care expenses incurred under HSA-compatible health plans before an individual establishes an HSA.
The bill was referred to the House Ways and Means Committee whose chairman, Bill Thomas (R-CA) reportedly supports the bill. Rep. Cantor, who sits on that Committee, would like for the full House to vote on the bill during its Health Week scheduled for the week of June 18th. The stumbling block for this bill may be the Senate.