WASHINGTON – People who set aside salary in tax-free accounts for health bills would be able to roll unused funds over to the next year or into long-term health savings accounts under legislation approved by the House on Wednesday.
Approved 273-153, the bill is one of three pieces of related legislation that Republicans are pushing during a week of heightened attention to health care and the uninsured. All three have previously passed the Republican-led House, but have been blocked in the Senate, leading Democrats to assert that the new round of votes is merely political theater.
The other bills would place limits on medical malpractice awards and let smaller employers buy into national health insurance plans to get more affordable rates for employees.
Flexible spending accounts help employees pay for co-payments, deductibles and other such health expenses that are not covered by insurance.
Employees who establish flexible spending accounts agree to set aside a specified amount of salary – say, $1,000 for medical costs not covered by the employee’s health insurance. Workers’ taxable income is then reduced by that amount, saving them money at tax time.
But employees currently forfeit unused money to their employer, a major reason that spending accounts are held by only 7 million, or 18 percent, of the 37 million eligible employees, supporters say.
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