On May 12, the House passed H.R. 4279 which would amend the Internal Revenue Code to provide for the disposition of unused health benefits in cafeteria plans and flexible spending arrangements. (In other words, the bill would abolish the very unpopular “use-it-or-lose-it-rule” which has plagued these type of plans.) Articles:
- Wall Street Journal (subscription required): “House Passes Bill, Allowing Rollover of Unused Money In Flexible Spending Accounts”
- AP via SFGate.com: “House passes bill to allow rollover of unused money in flexible spending accounts”
Also, on May 12, H.R. 3574, the Stock Option Accounting Reform Act, was passed in the House Financial Services Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises. (Press release is here.) The bill would require companies to expense stock options granted to the five highest-paid officers and would also defer enforcement of any Financial Accounting Standards Board expensing rule until the Securities and Exchange Commission does a study on its economic impact. Articles:
- CFO.com: “House Bill Would Impede FASB”
- AccountingWeb.com: “Stock Options Accounting Legislation Clears House Subcommittee”
- Reuters via Forbes.com: “US House panel backs limit to options expensing”
Then, on May 13, the House voted (252-162) to approve H.R. 4281, the “Small Business Health Fairness Act of 2004” which would amend ERISA to provide for the establishment and governance of association health plans (AHPs). (H.R. 4281 has been appended to H.R. 4279 above.) AHPs would be group health plans whose sponsors are trade, industry, professional, chamber of commerce, or similar business associations, and which would meet certain ERISA certification requirements. The bill would establish rules governing AHPs (through ERISA preemption of state law), including requirements relating to certification, sponsors and boards of trustees, participation and coverage, nondiscrimination, plan documents, contribution rates, benefit options, applications for certification, notice of voluntary termination, corrective actions, and mandatory termination. Articles:
- KaiserNetwork.org: “House Approves Association Health Plan Legislation”
- Reuters: “U.S. House Backs Small Business Health Plans”
On May 13, the House by a vote of 344-76 also approved H.R. 4275, a bill to permanently extend the 10% individual income tax rate bracket. The provision would make permanent the expanded 10% income bracket by preventing the scheduled reduction in 2005 of the upper threshold for the 10% tax bracket (for single taxpayers, joint-filers, and qualifying surviving spouses). A Democratic amendment in the nature of a substitute was offered by House Ways and Means Ranking Democrat Charlie Rangel (D-NY), but was defeated by a vote of 190-227.