I
106TH CONGRESS
1ST SESSION
H. R. 614
To amend the Internal Revenue Code of 1986 to expand the availability
of medical savings accounts.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 8, 1999
Mr. ARCHER (for himself, Mr. LIPINSKI, Mr. THOMAS, Mr. CRANE, Mr. HALL
of Texas, Mr. COOKSEY, Mr. GOSS, Mr. ARMEY, Mr. ROYCE, Mr. PETER-
SON of Pennsylvania, Mr. BRADY of Texas, Mr. MCCOLLUM, Mr.
PORTMAN, Mr. HILLEARY, Mr. HOSTETTLER, Mr. BONILLA, Mr.
TANCREDO, Mr. STUMP, Mr. LARGENT, Mr. CUNNINGHAM, Mr. YOUNG
of Alaska, Mr. KOLBE, Mrs. MYRICK, Mr. RAMSTAD, Mr. COBURN, Mr.
BURTON of Indiana, Mr. ENGLISH, Mr. MCCRERY, Mr. HAYWORTH, and
Mr. SHADEGG) introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to expand
the availability of medical savings accounts.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Medical Savings Ac-
count Effectiveness Act of 1999’’.
SEC. 2. EXPANSION OF AVAILABILITY OF MEDICAL SAV-
INGS ACCOUNTS.
(a) REPEAL OF LIMITATIONS ON NUMBER OF MEDI-
CAL SAVINGS ACCOUNTS.—
(1) IN GENERAL.—Subsections (i) and (j) of
section 220 of the Internal Revenue Code of 1986
are hereby repealed.
(2) CONFORMING AMENDMENT.—Paragraph (1)
of section 220(c) of such Code is amended by strik-
ing subparagraph (D).
(b) ALL EMPLOYERS MAY OFFER MEDICAL SAVINGS
ACCOUNTS.—
(1) IN
GENERAL.—Subclause (I) of section
220(c)(1)(A)(iii) of such Code (defining eligible indi-
vidual) is amended by striking ‘‘and such employer
is a small employer’’.
(2) CONFORMING AMENDMENTS.—
(A) Paragraph (1) of section 220(c) of
such Code is amended by striking subparagraph
(C).
(B) Subsection (c) of section 220 of such
Code is amended by striking paragraph (4) and
by redesignating paragraph (5) as paragraph
(4).
(c) INCREASE IN AMOUNT OF DEDUCTION ALLOWED
FOR CONTRIBUTIONS TO MEDICAL SAVINGS ACCOUNTS.—
(1) IN
GENERAL.—Paragraph (2) of section
220(b) of such Code is amended to read as follows:
‘‘(2) MONTHLY LIMITATION.—The monthly lim-
itation for any month is the amount equal to 1⁄12 of
the annual deductible (as of the first day of such
month) of the individual’s coverage under the high
deductible health plan.’’.
(2) CONFORMING AMENDMENT.—Clause (ii) of
section 220(d)(1)(A) of such Code is amended by
striking ‘‘75 percent of’’.
(d) BOTH EMPLOYERS AND EMPLOYEES MAY CON-
TRIBUTE TO MEDICAL SAVINGS ACCOUNTS.—Paragraph
(5) of section 220(b) of such Code is amended to read
as follows:
‘‘(5) COORDINATION WITH EXCLUSION FOR EM-
PLOYER
CONTRIBUTIONS.—The limitation which
would (but for this paragraph) apply under this sub-
section to the taxpayer for any taxable year shall be
reduced (but not below zero) by the amount which
would (but for section 106(b)) be includible in the
taxpayer’s gross income for such taxable year.’’.
(e) REDUCTION
OF
PERMITTED
DEDUCTIBLES
UNDER HIGH DEDUCTIBLE HEALTH PLANS.—
(1) IN GENERAL.—Subparagraph (A) of section
220(c)(2) of such Code (defining high deductible
health plan) is amended—
(A) by striking ‘‘$1,500’’ and inserting
‘‘$1,000’’, and
(B) by striking ‘‘$3,000’’ in clause (ii) and
inserting ‘‘$2,000’’.
(2) CONFORMING AMENDMENT.—Subsection (g)
of section 220 of such Code is amended—
(A) by striking ‘‘1998’’ and inserting
‘‘1999’’; and
(B) by striking ‘‘1997’’ and inserting
‘‘1998’’.
(f) MEDICAL SAVINGS ACCOUNTS MAY BE OFFERED
UNDER CAFETERIA PLANS.—Subsection (f) of section
125 of such Code is amended by striking ‘‘106(b),’’.
(g) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending after the
date of the enactment of this Act.
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