Congress should expand Health Savings Accounts in next coronavirus relief package
In the face of the coronavirus pandemic, policymakers are rightly leaving no stone unturned for proposals that can help mitigate the economic and healthcare damage caused by the virus. While Congress recently passed the Coronavirus Aid, Relief, and Economic Security Act to help citizens through this crisis, Senate Majority Leader Mitch McConnell has said there will likely be additional legislation in the coming weeks or months focusing on healthcare measures.
One policy that should be considered in this “Phase 4” bill is an expansion of tax-advantaged health savings accounts, or HSAs, through the Pandemic Healthcare Access Act. This legislation, introduced by Sen. Ted Cruz and Rep. Ted Budd, lifts the mandate that a HSA can only be paired with a high-deductible health plan for the duration of the coronavirus emergency.
The bill will expand HSAs to citizens on Medicare, Obamacare health plans, other government plans, and any employer plan. It will also help individuals pay for their deductible or any increased healthcare costs, allow HSA funds to pay for direct primary care, and allow telemedicine below the deductible.
This will open up HSA benefits to millions of people across the country. Individuals will be able to receive HSA contributions from their employers to spend on care, make tax-deductible contributions to their HSA for future healthcare expenses, and invest these savings for future economic security.