On July 12, 2018, the House Ways and Means Committee advanced seven additional bills aimed at expanding consumer-directed health care and easing the burden on employer coverage, adding to the four primarily HSA-focused bills from an earlier session. Bills advanced out of committee include those that would expand the use of tax-favored health accounts by adding various over-the-counter (OTC) medications and sports and fitness expenses to qualifying medical expenses, allowing flexible savings account (FSA) balances to be rolled-over, increasing the contribution limits of Health Saving Accounts (HSAs), and allowing HSAs to be paired with bronze and "catastrophic" plans in the individual and small group markets. The Committee also passed H.R. 4616, which would provide retroactive relief from the employer mandate under the Affordable Care Act (ACA) and one additional year of delay in the implementation of the ACA's "Cadillac Tax." Additionally, it passed H.R. 6311, which would allow premium tax credits to be used for qualified plans offered outside the ACA exchanges, expanding access to "catastrophic" plans to all individuals in the individual market, and allowing premium tax credits to be used to offset the cost of those plans.

Throughout the hearing, Democrats continued criticizing Republican efforts to expand HSAs for the benefit of the wealthy while the Administration and Congress undermine the ACA and provide no relief to the majority of Americans struggling with rising health care costs. They also turned the debate to hot-button issues such as the ACA's pre-existing condition protections, the freezing of risk-adjustment payments, health care access for women, and immigration policy. Republicans deflected concerns raised by Democrats while continuing to promote the use of HSAs as a mechanism to help middle-income Americans and reduce the harm done by the ACA. Several bill sponsors stressed that nothing in proposed legislation would undermine pre-existing condition protections and dismissed other concerns as irrelevant or not within their jurisdiction, both sides accusing the other of politicking. Democratic amendments, all of which were defeated, would have allowed the use of HSAs to assist immigrant children separated from their parents at the border, ensure people with pre-existing conditions stay insured under Republican legislation and stop the enactment of certain bills if the Administration's actions to freeze risk adjustment payments result in insurance price increases, among others.

The bills are expected to be considered by the full House the week of July 23.

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Markup detail

Consideration of bills

H.R. 6199, "To amend the Internal Revenue Code of 1986 to include certain over-the-counter medical products as qualified medical expenses." Sponsored by Reps. Lynn Jenkins (R-KS) and Grace Meng (D-NY), the bill would reverse the ACA's prohibition on using tax-favored health accounts to purchase OTC medical products and adds feminine or "menstrual care" products to the list of qualified medical expenses for the purposes of these tax-favored health accounts.

Action: Amendment in nature of substitute was agreed to and H.R. 6199 ordered to be reported favorably, as amended, by a vote of 24-10.

H.R. 6312, "Personal Health Investment Today (PHIT) Act." Sponsored by Reps. Jason Smith (R-MO) and Ron Kind (D-WI), the bill would add qualified sports and fitness expenses to the definition of qualified medical expenses.

Action: Amendment in nature of substitute was agreed to and H.R. 6312 ordered to be reported favorably, as amended, by a vote of 28-7.

H.R. 4616, "To amend the Patient Protection and Affordable Care Act to provide for a temporary moratorium on the employer mandate and to provide for a delay in the implementation of the excise tax on high cost employer-sponsored health coverage." Sponsored by Reps. Devin Nunes (R-CA) and Mike Kelly (R-PA),the bill would provide retroactive relief from the ACA's employer mandate and one additional year of delay in the implementation of the law's "Cadillac Tax."

Action: Amendment in nature of substitute was agreed to and H.R. 4616 ordered to be reported favorably, as amended, by a vote of 22-15.

H.R. 6306, "To amend the Internal Revenue Code of 1986 to increase the contribution limitation for health savings accounts, and for other purposes." Sponsored by Rep. Erik Paulsen (R-MN), the bill would (1) increase the contribution limits for HSAs; (2) permit spousal catch-up contributions into the same account; and (3) create a grace period for medical expenses incurred before the establishment of an HSA.

Action: An amendment by Rep. Lloyd Doggett (D-TX) to make clear plans purchased through expansion of the bill would not undermine pre-existing condition protections was defeated 15-23. An amendment by Rep. Judy Chu (D-CA) that would allow individuals to temporarily designate HSA funds to ensure unaccompanied children in detention centers receive trauma-based care was also defeated. Amendment in nature of substitute was agreed to by voice vote and H.R. 6306 was ordered to be reported favorably, as amended, by a vote of 22-16.

H.R. 6313, "Responsible Additions and Increases to Sustain Employee Health Benefits Act of 2018." Sponsored by Rep. Steve Stivers (R-OH), the bill would allow FSA balances in to be carried forward each year.

Action: Amendment in nature of substitute was agreed to by voice vote and H.R. 6313 was ordered to be reported favorably, as amended, by a vote of 22-14.

H.R. 6314, "Health Savings Act of 2018." Sponsored by Rep. Michael Burgess (R-TX) and Health Subcommittee Chairman Peter Roskam (R-IL), the bill would expand eligibility and access to HSAs by allowing plans categorized as catastrophic and bronze in the individual and small group markets to qualify for HSA contributions.

Action: Amendment in nature of substitute was agreed to by voice vote and H.R. 6314 was ordered to be reported favorably, as amended, by a vote of 23-13.

H.R. 6311, "To amend the Internal Revenue Code of 1986 and the Patient Protection and Affordable Care Act to modify the definition of qualified health plan for purposes of the health insurance premium tax credit and to allow individuals purchasing health insurance in the individual market to purchase a lower premium copper plan." Sponsored by Health Subcommittee Chairman Peter Roskam (R-IL) and Rep. Michael Burgess (R-TX), the bill would allow premium tax credits to be used for qualified plans offered outside of the law's exchanges and Healthcare.gov. In addition, it would expand access to the lowest-premium plans available (catastrophic plans) for all individuals purchasing coverage in the individual market and allow the premium tax credit to be used to offset the cost of those plans.

Action: An amendment by Rep. Mike Thompson (D-CA) to stop the underlying bill if the Administration's actions to freeze risk-adjustment payments result in insurance price increases was tabled. An amendment by Rep. Suzan DelBene (D-WA) that would strike language making abortion access more difficult was defeated 15-22. An amendment by Rep. Linda Sanchez (D-CA) to ensure plans do not discriminate against women was defeated 16-23. Amendment in nature of substitute was agreed to by voice vote and H.R. 6311 was ordered to be reported favorably, as amended, by a vote of 23-16.

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