Title: Mandate Relief Act of 2017
Policy area: Taxation

Summary:
Mandate Relief Act of 2017
This bill amends the Internal Revenue Code (IRC) to allow additional exemptions from the requirement under the Patient Protection and Affordable Care Act (PPACA) to maintain minimum essential health coverage (commonly referred to as the individual mandate). The bill exempts individuals who: (1) have household incomes below the national median, (2) reside in a state in which the average premium for self-only or family coverage under the second lowest cost silver plan within the state has increased by more than 10% from the prior year, or (3) reside in a county with fewer than two health insurance issuers offering qualified plans on an exchange.
The bill also repeals provisions added to the IRC by PPACA that: (1) restrict payments from health savings accounts (HSAs), Archer medical savings accounts (MSAs), and health flexible spending and reimbursement arrangements for medications to prescription drugs and insulin (thus allowing payments for over-the-counter medications); (2) impose a $2,500 limitation on salary reduction contributions to a health flexible spending arrangement under a cafeteria plan; and (3) impose an additional tax on HSA and Archer MSA distributions not used for qualified medical expenses.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 1967 Introduced in Senate (IS)]

<DOC>






115th CONGRESS
  1st Session
                                S. 1967

   To amend the Internal Revenue Code of 1986 to provide additional 
     exemptions to the individual mandate, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 17, 2017

Mr. Cotton (for himself and Mr. Toomey) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to provide additional 
     exemptions to the individual mandate, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Mandate Relief Act of 2017''.

SEC. 2. MODIFICATIONS TO EXEMPTION TO REQUIREMENT TO MAINTAIN HEALTH 
              COVERAGE.

    (a) Exemption for Individuals With a Household Income Less Than the 
National Median and for Individuals With Excessive Premium Increases.--
Section 5000A(e) of the Internal Revenue Code of 1986 is amended by 
striking paragraphs (1) and (2) and inserting the following:
            ``(1) Individuals with household incomes below the national 
        median.--Any applicable individual for any month if the 
        applicable individual has a household income for the taxable 
        year which is less than the national median household income 
        for the most recent calendar year.
            ``(2) Individuals with excessive premium increases.--Any 
        applicable individual for any month during a calendar year if 
        such applicable individual resides in a State in which either--
                    ``(A) the average premium for self-only coverage 
                for the second lowest cost silver plan within the State 
                for such calendar year is more than 10 percent greater 
                than the average premium for self-only coverage for the 
                second lowest cost silver plan within the State for the 
                preceding calendar year, or
                    ``(B) the average premium for family coverage for 
                the second lowest cost silver plan within the State for 
                such calendar year is more than 10 percent greater than 
                the average premium for family coverage for the second 
                lowest cost silver plan within the State for the 
                preceding calendar year.''.
    (b) Additional Exemptions.--Section 5000A(e) of the Internal 
Revenue Code of 1986 is amended by adding at the end the following new 
paragraph:
            ``(6) Individuals in areas with fewer than 2 issuers 
        offering plans on an exchange.--
                    ``(A) In general.--Any applicable individual for 
                any period during a calendar year if there are fewer 
                than 2 health insurance issuers offering qualified 
                health plans on an Exchange for such period in the 
                county in which the applicable individual resides.
                    ``(B) Aggregation rules.--For purposes of 
                subparagraph (A), all health insurance issuers treated 
                as a single employer under subsection (a) or (b) of 
                section 52, or subsection (m) or (o) of section 414, 
                shall be treated as a single health insurance 
                issuer.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to months beginning after the date of the enactment of this Act.

SEC. 3. REPEAL OF DISTRIBUTIONS FOR MEDICINE QUALIFIED ONLY IF FOR 
              PRESCRIBED DRUG OR INSULIN.

    (a) HSAs.--Subparagraph (A) of section 223(d)(2) of the Internal 
Revenue Code of 1986 is amended by striking the last sentence.
    (b) Archer MSAs.--Subparagraph (A) of section 220(d)(2) of the 
Internal Revenue Code of 1986 is amended by striking the last sentence.
    (c) Health Flexible Spending Arrangements and Health Reimbursement 
Arrangements.--Section 106 of the Internal Revenue Code of 1986 is 
amended by striking subsection (f).
    (d) Effective Dates.--
            (1) Distributions from savings accounts.--The amendments 
        made by subsections (a) and (b) shall apply to amounts paid 
        with respect to taxable years beginning after December 31, 
        2016.
            (2) Reimbursements.--The amendment made by subsection (c) 
        shall apply to expenses incurred with respect to taxable years 
        beginning after December 31, 2017.

SEC. 4. REPEAL OF LIMITATION ON HEALTH FLEXIBLE SPENDING ARRANGEMENTS 
              UNDER CAFETERIA PLANS.

    (a) In General.--Section 125 of the Internal Revenue Code of 1986 
is amended--
            (1) by striking subsection (i); and
            (2) by redesignating subsections (j), (k), and (l) as 
        subsections (i), (j), and (k), respectively.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2017.

SEC. 5. REPEAL OF TAX ON HEALTH SAVINGS ACCOUNTS.

    (a) HSAs.--Section 223(f)(4)(A) of the Internal Revenue Code of 
1986 is amended by striking ``20 percent'' and inserting ``10 
percent''.
    (b) Archer MSAs.--Section 220(f)(4)(A) of the Internal Revenue Code 
of 1986 is amended by striking ``20 percent'' and inserting ``15 
percent''.
    (c) Effective Date.--The amendments made by this section shall 
apply to distributions made after December 31, 2017.
                                 <all>