As promised, the Senate Finance Committee released America’s Healthy Future Act of 2009 shortly before noon today (9/16/09). A quick review of the 220-page Act indicates that our expectations stated in a previous post are generally in line with the Act. Four items in the Act affect TASC and our customers:
- The cap on Flexible Spending Accounts (FSAs) is set at $2,000 per year. No surprise there.
- The cap on healthcare is set at $8,000 for singles, and at $21,000 for families. The penalty for exceeding the cap is 35 percent of the amount that exceeds the thresholds. The penalty (excise tax) is higher than I expected.
- Over-the-counter medications are no longer an eligible expense under FSAs, Health Reimbursement Arrangements (HRAs), and Health Savings Accounts (HSAs). This would go into effect in 2010!
- The caps (on FSAs and on overall healthcare) are tied to the Consumer Price Index (CPI). The first adjustment to these caps will not take place until 2014.
Another item will affect customers of our HSA services: the tax on distributions from a HSA for non-medical expenses will increase to 20 percent of the disbursed amount. This change is scheduled to be effective January 1, 2010.
We will continue to keep our customers informed and will monitor developments closely as this progresses through the political process.
TASC CEO Blog 