I
107TH CONGRESS
1ST SESSION
H. R. 1524
To amend the Internal Revenue Code of 1986 to expand the availability
of Archer medical savings accounts.
IN THE HOUSE OF REPRESENTATIVES
APRIL 4, 2001
Mr. THOMAS (for himself, Mr. LIPINSKI, Mrs. JOHNSON of Connecticut, Mr.
PETERSON of Minnesota, Mr. CRANE, Mr. PHELPS, Mr. MCCRERY, Mr.
DEUTSCH, Mr. CAMP, Mr. HALL of Texas, Mr. RAMSTAD, Mr. LUCAS of
Kentucky, Mr. SAM JOHNSON of Texas, Ms. DUNN, Mr. ENGLISH, Mr.
HAYWORTH, Mr. MCINNIS, Mr. LEWIS of Kentucky, Mr. BRADY of
Texas, Mr. ARMEY, Mr. DELAY, Mr. MILLER of Florida, Mr. PAUL, Mr.
ROGERS of Michigan, Mr. FOSSELLA, Mr. TANCREDO, Mr. SCHAFFER,
Mr. WALSH, Mr. REYNOLDS, Mr. COOKSEY, Mr. SESSIONS, Mr. OSE, Ms.
HART, and Mrs. KELLY) 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 Archer 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 Availability Act of 2001’’.
SEC. 2. EXPANSION OF AVAILABILITY OF ARCHER MEDICAL
SAVINGS ACCOUNTS.
(a) REPEAL OF LIMITATIONS ON NUMBER OF MED-
ICAL SAVINGS ACCOUNTS.—
(1) IN GENERAL.—Subsections (i) and (j) of
section 220 of the Internal Revenue Code of 1986
are hereby repealed.
(2) CONFORMING AMENDMENTS.—
(A) Paragraph (1) of section 220(c) of
such Code is amended by striking subparagraph
(D).
(B) Section 138 of such Code is amended
by striking subsection (f).
(b) AVAILABILITY NOT LIMITED TO ACCOUNTS FOR
EMPLOYEES
OF
SMALL
EMPLOYERS
AND
SELF-EM-
PLOYED INDIVIDUALS.—
(1) IN GENERAL.—Subparagraph (A) of section
220(c)(1) of such Code (relating to eligible indi-
vidual) is amended to read as follows:
‘‘(A) IN GENERAL.—The term ‘eligible in-
dividual’ means, with respect to any month, any
individual if—
‘‘(i) such individual is covered under a
high deductible health plan as of the 1st
day of such month, and
‘‘(ii) such individual is not, while cov-
ered under a high deductible health plan,
covered under any health plan—
‘‘(I) which is not a high deduct-
ible health plan, and
‘‘(II) which provides coverage for
any benefit which is covered under the
high deductible health plan.’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 220(c)(1) of such Code is
amended by striking subparagraph (C).
(B) Section 220(c) of such Code is amend-
ed by striking paragraph (4) (defining small
employer) and by redesignating paragraph (5)
as paragraph (4).
(C) Section 220(b) of such Code is amend-
ed by striking paragraph (4) (relating to deduc-
tion limited by compensation) and by redesig-
nating paragraphs (5), (6), and (7) as para-
graphs (4), (5), and (6), respectively.
(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
(4) of section 220(b) of such Code (as redesignated by
subsection (b)(2)(C)) is amended to read as follows:
‘‘(4) 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’’ in clause (i) 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 to read as
follows:
‘‘(g) COST-OF-LIVING ADJUSTMENT.—
‘‘(1) IN GENERAL.—In the case of any taxable
year beginning in a calendar year after 1998, each
dollar amount in subsection (c)(2) shall be increased
by an amount equal to—
‘‘(A) such dollar amount, multiplied by
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for the calendar
year in which such taxable year begins by sub-
stituting ‘calendar year 1997’ for ‘calendar year
1992’ in subparagraph (B) thereof.
‘‘(2) SPECIAL
RULES.—In the case of the
$1,000 amount in subsection (c)(2)(A)(i) and the
$2,000 amount in subsection (c)(2)(A)(ii), para-
graph (1)(B) shall be applied by substituting ‘cal-
endar year 2000’ for ‘calendar year 1997’.
‘‘(3) ROUNDING.—If any increase under para-
graph (1) or (2) is not a multiple of $50, such in-
crease shall be rounded to the nearest multiple of
$50.’’.
(f) PROVIDING INCENTIVES FOR PREFERRED PRO-
VIDER ORGANIZATIONS TO OFFER MEDICAL SAVINGS AC-
COUNTS.—Clause (ii) of section 220(c)(2)(B) of such Code
is amended by striking ‘‘preventive care if’’ and all that
follows and inserting ‘‘preventive care.’’
(g) MEDICAL SAVINGS ACCOUNTS MAY BE OFFERED
UNDER CAFETERIA PLANS.—Subsection (f) of section
125 of such Code is amended by striking ‘‘106(b),’’.
(h) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 2001.
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