Rep. Bill Archer (R - Texas) is reportedly pushing for a bill that would make the program - which is set to expire at the end of the year - permanent, would lower the eligibility limits, and repeal the cap on the number of accounts allowed, now set at 750,000. The proposal would also repeal a rule that prevents employees and employers from contributing to an MSA in the same year, and lower the minimum insurance deductible amount from $1,500 to $1,000 for individuals, and $3,000 to $2,000 for families, according to wire service reports.

The legislation is currently attached to the Patients Bill of Rights tied up in Congress, but Archer reportedly said the MSA provisions could be attached to another bill more likely to gain a presidential signature, Reuters reported.

MSAs were introduced in 1996 on a four-year trial basis that ends this year. Under the current law, only the self-employed or those who work for a business with less than fifty employees are eligible. Under the program, money put into an MSA isn't included in taxable income, and money spent from the MSA on medical services isn't taxed. Any unused money in an MSA at the end of the tax year can be withdrawn tax-free for future medical expenses. As of last year, just under 55,000 MSAs were open.

Proponents say interest in the accounts has been hampered by the restrictions surrounding MSAs. However, critics argue that expanding MSAs would benefit the wealthy at the expense of the sick, according to news reports.

-- SmartPros News Staff

Send comments to information@smartpros.com

Back to NewsLine