WASHINGTON – Congressman Vern Buchanan, Vice Chairman of the House Ways and Means Committee and Chairman of the Healthcare Subcommittee, and Congressman Mike Thompson (D-CA) announced today that they have introduced the Lowering Costs for Caregivers Act (H.R. 7222). The bipartisan legislation would lower costs for caregivers by allowing individuals to use tax-free health savings accounts and flexible spending accounts on medical expenses for their parents and loved ones. Currently, caregivers are unable to take advantage of these tax-free accounts unless their parents are classified as dependents for tax purposes.
“As millions of Americans learn every year, caring for aging parents or loved ones in their later years can become a significant financial strain for you and your family,” said Congressman Buchanan. “With nearly 200,000 seniors in my district, caregiving assistance is critical for many families to give their loved ones a dignified quality of life in their golden years.”
“Taking care of aging parents is a significant cost for millions of Americans and can too often place a tremendous financial burden on those responsible for the care,” said Congressman Thompson. “Allowing Americans to use their HSAs to pay for caregiving for their parents is a commonsense step that will make this care more affordable. Proud to work with Rep. Buchanan on this important bipartisan effort to lower costs associated with senior care.”
Companion legislation was introduced in the U.S. Senate last year by Senators Bill Cassidy (R-TN) and Jackie Rosen (D-NV).
This legislation has the support of the American Association of Retired Persons (AARP) and Fidelity Investments.
In endorsing the legislation, Nancy Leamond of AARP praised Buchanan and Thompson’s “bipartisan efforts to ease the financial challenges faced by millions of family caregivers.” AARP also called the bill “an important step to help alleviate the financial challenges that millions of family caregivers experience every day, especially the increasing number of ‘sandwich generation’ caregivers who are simultaneously caring for their parents and their own children.”
“Americans are increasingly providing caregiving for loved ones, including aging parents or partners, which is why Fidelity is pleased to support this legislation,” said Karen Volo, Head of Health and Benefit Accounts, Fidelity Investments. “Many households increasingly turn to savings options such as HSAs and FSAs to save for health care, and this proposal will allow individuals to use these funds for medical expenses relating to caregiving costs. As the ranks of those giving and receiving care continues to grow, planning and financial considerations will demand attention and support. This expansion is a great step toward bolstering that support financially.”
Buchanan previously helped secure passage of legislation to increase opportunities for retirement savings, including the Setting Every Community up for Retirement Enhancement Act (SECURE 1.0) and the SECURE 2.0 Act. These crucial pieces of legislation help to incentivize savings for lower-and-middle income Americans as well as expand automatic enrollment for retirement accounts.
