WASHINGTON ??? This week, bipartisan provisions from legislation originally introduced by Congressman Steve Stivers (R ??? OH) in the Responsible Additions and Increases to Sustain Employee (RAISE) Health Benefits Act, was included in House passage of H.R. 6311.
These provisions would provide more flexibility for families with Flexible Spending Accounts (FSAs) by allowing for the rollover of unused funds into the next year. Employers can also contribute annually to their employee???s FSAs. Currently, families with leftover funds in their FSA are asked to forfeit those dollars at the end of each year, forcing Americans to ???use it or lose it??? regardless if they???ve saved enough for their unique expenses. These provisions would allow funds in the FSA to roll over year after year, providing families the ability to save for future expenses on their own terms. Additionally, it would increase the total cap to $7,950 in an FSA – triple the current limit that can be saved in a single year.
???In many aspects of life, families need flexibility. It just makes sense that families should have the flexibility to not only have a larger FSA account to plan for future expenses, but also roll over unused funds from year to year to save money,??? Stivers said. ???This is just one way we can help families with the cost of healthcare. I want to thank the Ways and Means Committee for including my provision in H.R. 6311, and I hope it is considered by the Senate soon.???
Currently, FSAs allow families to set aside money to pay for health care services and items that are not covered by insurance, such as: doctor copayments, prescription drugs, medical supplies, orthodontic work, vision and dental services. However, if those dollars do not roll over to the next year, the family must start saving all over again. ???Use it or lose it??? forfeiture make the process of saving money for large medical expenses practically impossible. For a family of four with children needing braces, updating prescription glasses, or facing the unexpected medical emergency, the current limits in place make it hard to cover these costs.
In 2010, Obamacare created an annual cap for FSA contributions of $2,650. This arbitrary cap does not reflect the reality of current health care costs that families face today and undermines the economic benefits of allowing families to use FSAs to build up funds over time for their medical needs. By raising the limit FSAs can hold, and allowing families to keep their own money, FSAs can be truly flexible for families of all sizes to save for their own medical needs.
Dr. Brent Larson, President of the American Association of Orthodontists, provided the following quote of support: “Consumers and patients across the country can celebrate what Rep. Stivers’ leadership has achieved with passing the RAISE Act today in the House of Representatives. The RAISE Act gives consumers greater control over their family’s healthcare needs. Rep. Stivers has spent years building a bipartisan coalition to make common sense changes to the law that will empower consumers and rein in healthcare costs, and today’s vote passing the RAISE Act is a critical step forward for his vision. The RAISE Act lets consumers save up to three times the current annual limit of their flexible spending account (FSA) for future medical needs, and stops wasteful healthcare spending by ending the “use it or lose it” feature that never made sense for families. That means the average family expecting a child to need braces, or other anticipated medical expense, could save a modest amount each month and roll those funds over for a few years until they were needed. That’s a win for patients and families across the country. We call on the Senate to fulfill the true potential of FSA reform by allowing savings to roll over each year while still allowing families to save $5,000 in new money each year.”