Helping Save Americans’ Health Care Choices Act of 2013
A BILL
To repeal provisions of the Patient Protection and Affordable Care Act relating to health savings accounts, and for other purposes.
Sec. 2 Repeal of additional tax from distributions from HSAs and MSAs
Section 9004 of the Patient Protection and Affordable Care Act is hereby repealed, and effective as of the date of the enactment of such Act the provisions of the Internal Revenue Code of 1986 amended by such section are amended to read as such provisions would read if such section had never been enacted.
Sec. 3 Repeal of limitation on deductions making non-prescription drugs non-qualifying distributions from tax-preferred accounts
Section 9003 of the Patient Protection and Affordable Care Act is hereby repealed, and effective as of the date of the enactment of such Act the provisions of the Internal Revenue Code of 1986 amended by such section are amended to read as such provisions would read if such section had never been enacted.
Sec. 4 Treatment of high deductible health plans as qualified health plan under the Patient Protection and Affordable Care Act
Subparagraph (B) of section 1301(a)(1) of the Patient Protection and Affordable Care Act is amended by inserting “or meets the requirements for a high deductible health plan under section 223(c)(2) of the Internal Revenue Code of 1986” after “section 1302(a)”.
Sec. 5 Repeal of limitation on health flexible spending arrangements under cafeteria plans
Sections 9005 and 10902 of the Patient Protection and Affordable Care Act are hereby repealed, and effective as of the date of the enactment of such Act the provisions of the Internal Revenue Code of 1986 amended by such sections are amended to read as such provisions would read if such sections had never been enacted.
Sec. 6 Saver’s credit for contributions to health savings accounts
Allowance of credit— Subsection (a) of section 25B of the Internal Revenue Code of 1986 is amended by inserting “aggregate qualified HSA contributions and” after “so much of the”.
Qualified HSA contributions— Subsection (d) of section 25B of such Code is amended by redesignating paragraph (2) as paragraph (3) and by inserting after paragraph (1) the following new paragraph:
“(2) Qualified HSA contributions—The term qualified HSA contribution means, with respect to any taxable year, a contribution of the eligible individual to a health savings account (as defined in section 223(d)(1)) for which a deduction is allowable under section 223(a) for such taxable year.”
Conforming amendment— The first sentence of section 25B(d)(3)(A) of such Code (as redesignated by subsection (b)) is amended to read as follows: “The aggregate qualified retirement savings contributions determined under paragraph (1) and qualified HSA contributions determined under paragraph (2) shall be reduced (but not below zero) by the aggregate distributions received by the individual during the testing period from any entity of a type to which contributions under paragraph (1) or paragraph (2) (as the case may be) may be made.”.
Effective date— The amendments made by this section shall apply to contributions made after December 31, 2013.
Sec. 7 HSA funds for premiums for high deductible health plans
In general— Subparagraph (C) of section 223(d)(2) of the Internal Revenue Code of 1986 is amended by striking “or” at the end of clause (iii), by striking the period at the end of clause (iv) and inserting “, or”, and by adding at the end the following:
“(v) a high deductible health plan if—
“(I) such plan is not offered in connection with a group health plan, and
“(II) no portion of any premium (within the meaning of applicable premium under section 4980B(f)(4)) for such plan is excludable from gross income under section 106.”
Effective Date— The amendment made by subsection (a) shall apply to premiums for a high deductible health plan for periods beginning after December 31, 2013.
Sec. 8 Requiring greater coordination between high deductible health plan administrators and HSA account administrators so that enrollees can enroll in both at the same time
The Secretary of the Treasury, through the issuance of regulations or other guidance, shall encourage administrators of health plans and trustees of health savings accounts to provide for simultaneous enrollment in high deductible health plans and setup of health savings accounts.
Sec. 9 Special rule for certain medical expenses incurred before establishment of account
In general— Subsection (d) of section 223 of the Internal Revenue Code of 1986 is amended by redesignating paragraph (4) as paragraph (5) and by inserting after paragraph (3) the following new paragraph:
“(4) Treatment of account established before tax return due for tax year—For purposes of this section, if, before the time prescribed by law for filing the return of tax for a taxable year (not including extensions thereof), a taxpayer—
“(A) establishes a health savings account,
“(B) makes contributions to a health savings account on account of such taxable year, or
“(C) makes payments or distributions from a health savings account for such taxable year,”
Conforming amendment— Paragraph (5) of section 223(d) of such Code, as redesignated by subsection (a), is amended by striking subparagraph (B) and redesignating subparagraphs (C) through (E) as subparagraphs (B) through (D), respectively.
Effective date— The amendments made by this section shall apply with respect to health savings accounts established, and contributions to and distributions from health savings accounts after, the date of the enactment of this Act.
Sec. 10 Provisions relating to medicare
Individuals over age 65 only enrolled in medicare part A— Section 223(b)(7) of the Internal Revenue Code of 1986 (relating to contribution limitation on Medicare eligible individuals) is amended by adding at the end the following new sentence: “This paragraph shall not apply to any individual during any period the individual’s only entitlement to such benefits is an entitlement to hospital insurance benefits under part A of title XVIII of such Act pursuant to an enrollment for such hospital insurance benefits under section 226(a)(1) of such Act.”.
Medicare beneficiaries participating in medicare advantage MSA may contribute their own money to their MSA— Subsection (b) of section 138 of such Code is amended by striking paragraph (2) and by redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively.
Effective date— The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Sec. 11 Individuals eligible for veterans benefits for a service-connected disability
In general— Section 223(c)(1) of the Internal Revenue Code of 1986 (defining eligible individual) is amended by adding at the end the following new subparagraph:
“(C) Special rule for individuals eligible for certain veterans benefits—For purposes of subparagraph (A)(ii), an individual shall not be treated as covered under a health plan described in such subparagraph merely because the individual receives periodic hospital care or medical services for a service-connected disability under any law administered by the Secretary of Veterans Affairs but only if the individual is not eligible to receive such care or services for any condition other than a service-connected disability.”
Effective date— The amendment made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Sec. 12 Increase the maximum contribution limit to an HSA to match deductible and out-of-pocket expense limitation
Self-Only coverage— Subparagraph (A) of section 223(b)(2) of the Internal Revenue Code of 1986 is amended by striking “$2,250” and inserting “the amount in effect under subsection (c)(2)(A)(ii)(I)”.
Family coverage— Subparagraph (B) of section 223(b)(2) of such Code is amended by striking “$4,500” and inserting “the amount in effect under subsection (c)(2)(A)(ii)(II)”.
Effective date— The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Sec. 13 FSA funds may be used for long-term care insurance premiums
In general— Subsection (c) of section 106 of the Internal Revenue Code of 1986 is amended by redesignating paragraph (2) as paragraph (3) and by amending so much of such subsection as precedes such paragraph (3) to read as follows:
“(c) Long-Term care benefits provided through flexible spending arrangements
“(1) In general—Effective on and after January 1, 2013, gross income of an employee shall not include employer-provided coverage for qualified long-term care services (as defined in section 7702B(c)) to the extent that such coverage is provided through a flexible spending or similar arrangement.
“(2) Premiums for long-term care—Qualified medical expenses for which reimbursement may be made by distributions from a flexible spending arrangement shall include amounts paid for long-term care coverage.”
Effective date— The amendment made by this section shall apply to taxable years beginning after December 31, 2013.
Sec. 14 Individuals eligible for TRICARE
In general— Section 223(c)(1) of the Internal Revenue Code of 1986 (defining eligible individual), as amended by section 11, is amended by adding at the end the following new subparagraph:
“(D) Special rule for individuals eligible for assistance under TRICARE—For purposes of subparagraph (A)(ii), an individual shall not be treated as covered under a health plan described in such subparagraph merely because the individual is eligible to receive hospital care, medical services, or prescription drugs under TRICARE Extra or TRICARE Standard and such individual is not enrolled in TRICARE Prime.”
Effective date— The amendment made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Sec. 15 Certain physician fees to be treated as medical care
In General— Subsection (d) of section 213 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
“(12) Pre-paid physician fees—The term medical care shall include amounts paid by patients to their primary physician in advance for the right to receive medical services on an as-needed basis.”
Effective Date— The amendment made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Sec. 16 Allow both spouses to make catch-up contributions to the same HSA account
In General— Paragraph (3) of section 223(b) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:
“(C) Special rule where both spouses are eligible individuals with 1 account—If—
“(i) an individual and the individual’s spouse have both attained age 55 before the close of the taxable year, and
“(ii) the spouse is not an account beneficiary of a health savings account as of the close of such year,”
Effective Date— The amendment made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Sec. 17 High deductible health plans renamed as HSA qualified health plans
In general— The following sections of the Internal Revenue Code of 1986 are each amended by striking “high deductible health plan” each place it appears and inserting “HSA qualified health plan”:
Section 26(b)(2)(S).
Paragraphs (3) and (5)(B)(ii) of section 106(e).
Section 223.
Section 408(d)(9).
Special rules— The amendments made by this section, the matter being inserted shall bear the same case, number, font, and font size as the matter being replaced.