What the American Health Care Act (AHCA) means for you

In a stunning turn of events for what has been an on-going topic of interest to many, on May 4th, 2017, the majority of the U.S. House of Representatives voted in favor of the American Health Care Act (AHCA) with a vote of 217 to 213. This officially advances it to the Senate for consideration. It is predicted to face an uphill battle in the Senate, where Republicans are hoping to get it passed through the budget reconciliation process.

The reconciliation process allows for a simple 51-vote majority to pass the Senate without the option of a Democratic filibuster. To get it passed under reconciliation however, according to the Committee for a Responsible Budget's explanation of the reconciliation process and what is known as the Byrd Rule, Republicans will need to prove that each aspect of the bill has a direct impact on the federal budget (among other requirements), which will be a difficult task.

Does the AHCA impact my FSA or HSA?

As the bill moves forward in the Senate, it is expected that it will face significant changes. However, in its current form, the AHCA features many provisions that would have impact to FSAs and HSAs, the biggest being:

  • Repeal of the OTC Rx requirements for FSAs/HSAs that requires users to submit a prescription for over-the-counter products with a medical ingredient.
  • Repeal of the FSA maximum contribution limit ($2,600 in 2017)
  • HSA maximum contributions would increase to $6,550 for self only and $13,100 for family
  • HSA catch-up contributions of $1,000 would be allowed for both spouses ages 55 and up. It is currently only allowed for the account-holder.
  • Further delay of the Cadillac Tax to 2025 (it is currently set to begin in 2020)

What happens next?

The process to pass a healthcare bill is a long and tenuous one, as we saw with the Affordable Care Act. President Obama first met with lawmakers and healthcare professionals to lay the groundwork for the bill in March 2009 and it wasn't until March 2010 that the ACA was finally signed into law. According to Politico, there are already rumblings that the Senate could produce its own version of the bill that would then be sent before the House of Representatives again, so there is likely a long road of committees and debate before a final piece of legislation reaches President Trump's desk.

At FSAstore.com/HSAstore.com, we will stay on top of any new developments so be sure to visit our blog often for the latest news on healthcare reform!

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