July 26, 2019
New guidance from the Internal Revenue Service makes it easier for employees to use their health savings accounts (HSA) for low-cost preventive-care services related to certain chronic illnesses, while a new bipartisan bill would allow employees over the age of 65 to continue to contribute to an HSA.
The IRS guidance, effective immediately, adds 14 treatments for a range of chronic conditions to the list of preventive care benefits for which an HSA can be used prior to the deductible being met for a high-deductible health plan.
New guidance stems from President Trump's executive order directing the Treasury Department to find ways to expand the use of health savings accounts to pay for "medical care that helps maintain health status for individuals with chronic conditions."
Separately, Reps. Ami Bera (D-CA) and Jason Smith (R-MO) introduced the Health Savings for Seniors Act (H.R. 3796), which would allow seniors covered under Medicare to create new HSAs or continue using and contributing to an HSA. Currently, seniors covered by Medicare are not eligible for HSAs. It also allows working seniors who have both Medicare and employer coverage of any type to be eligible for an HSA.