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Member, Beacon International Group, Ltd.
WASHINGTON--Expansion of health savings accounts both in the short and long term may have been dealt a fatal blow by the election of a Democratic majority in the House.
Business groups were hopeful that legislators would pass the HSA measure--approved in September by the House Ways and Means Committee--as part of a broader bill during a special, brief congressional session later this month.
That bill, embraced by committee Republicans and strongly opposed by the panel's Democrats--would allow bigger contributions to HSAs and make it easier for employers to convert first-generation consumer-driven health plans with HSAs.
The measure, though, was strongly opposed by both Rep. Charles Rangel, D-N.Y., who will succeed Rep. Bill Thomas, R-Calif., as committee chairman, and Pete Stark, D-Calif., who will become chairman of the Ways and Means Health subcommittee. Rep. Stark described the bill as a billion-dollar tax break for the wealthy, preferring that the money instead be used to support public health care programs.
With Democrats gaining control next year of the House, Washington observers say Republican-backed proposals have little chance of winning approval during this month's special congressional session.
And with HSA opponents soon to assume leadership positions on the Ways and Means Committee, which has jurisdiction over HSA proposals, the long-term outlook for expanding HSAs appears dim.