U.S. Reps. Brad Wenstrup (R-OH) and Mike Kelly (R-PA) recently introduced bipartisan legislation to provide flexibility for families with health flexible spending accounts (FSAs) and dependent care flexible spending arrangements.
“We should not penalize Americans who diligently saved their hard-earned money for healthcare and childcare,” Rep. Wenstrup said.
The congressman on May 22 sponsored the Family Savings Flexibility Act, H.R. 7008, with original cosponsors Rep. Kelly and U.S. Rep. Cindy Axne (D-IA) to temporarily adjust the rules for FSAs and Dependent Care Flexible Spending Accounts (DCFSAs) to account for COVID-19-related cancellations and delays.
H.R. 7008, if enacted, also would increase the contribution limits for health savings accounts (HSAs) and DCFSAs, according to a bill summary provided by Rep. Wenstrup’s office.
“Americans, now more than ever, need flexibility when it comes to their health care and child care services,” said Rep. Kelly. “The coronavirus pandemic has prevented Americans from using HSA and DCFSA savings for these purposes, so Congress must act to extend the time limit on spending these funds.
“By doing so, we can empower patients and parents during a time of unprecedented economic uncertainty,” he said.
Per U.S. Department of Health and Human Services guidelines, many hospitals, doctors’ offices, childcare services, and other qualifying purchases were forced to temporarily close or limit services due to the COVID-19 pandemic.
In response, the U.S. Treasury Department earlier this month issued certain changes to temporarily increase flexibility for these accounts. H.R. 7008 would build upon these changes by allowing employees to roll over their health FSA and DCFSA dollars into the 2021 plan year; increase the contribution limit for HSAs to be tied to the annual limit on out-of-pocket and deductible expenses under an HSA-qualified plan; and increase the DCFSA contribution limit from $5,000 to $10,000, according to the bill summary.
“As we emerge from coronavirus shutdowns, we must provide flexibility to those who were unable to use their health FSA or DCFSA funds due to delays in procedures and services,” said Rep. Wenstrup. “Our bipartisan bill provides the necessary fix for these Americans.”