The HSA Expansion Act – An Answer to Obamacare?
Many lawmakers and politicians seek to do away with Obamacare, but can’t seem to find a replacement. Meanwhile, Americans continue to struggle with hefty fees, high premiums, and measly coverage.
All of this might change if the Health Savings Account Expansion Act of 2016 (HR 5324) is passed. The proposal, introduced by Rep. Dave Brat (R-VA) and Sen. Jeff Flake (R-AZ), aims to put Americans back in charge of their healthcare by expanding and simplifying health savings accounts (HSAs).
An HSA is a tax-advantaged account used to pay for out-of-pocket medical expenses. HSAs are typically used in conjunction with insurance plans, the latter of which traditionally cover large or unexpected health costs. Brat and Flake’s bill focuses on four key reforms to provide Americans with access to patient centered healthcare that fits their needs and to keep healthcare costs at a minimum:
1. Raising contribution limits to $9,000 (single)/ $18,000 (joint)
2. Lifting the burden of ACA restrictions on normal, over-the-counter purchases
3. Allowing HSA funds to cover premiums and direct primary care expenses
4. Eliminating the high deductible health plan mandate and other unneeded regulatory requirements
In one fell swoop, the proposal gives prudent individuals the option to save more, erases some of the government’s interference in personal medical decisions, enables individuals to determine where and when they will spend their health savings, and protects Americans against the hidden costs of bureaucracy.
By expanding options for personalized medicine, the HSA Expansion Act will make healthcare more market friendly. It will lead to a bidding down in prices as proper market signals are exchanged between patients and providers.
The preservation of existing tax provisions will allow individuals to access and pay for healthcare at their discretion, whether through an employer or other entity. HR 5324 will also reduce the burden on employers by empowering workers to control their own compensation – further reducing the overall cost of healthcare. The proposal also includes language that would prevent the federal healthcare bureaucracy (Health and Human Services) from removing HSA-eligible plans from 2017 exchanges.
Sen. Flake and Rep. Brat’s HSA Expansion Act will empower working class Americans to take control over their healthcare as well as push the pendulum of federalism back towards the founders’ intended vision. Clearly, this bill makes several needed and commonsense improvements to health savings accounts that will increase healthcare freedom for American families.