Congressional Record, Volume 149 Issue 96 (Thursday, June 26, 2003)

[Congressional Record Volume 149, Number 96 (Thursday, June 26, 2003)]
[House]
[Pages H5992-H6006]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

HEALTH SAVINGS AND AFFORDABILITY ACT OF 2003

Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 299, I call up
the bill (H.R. 2596) to amend the Internal Revenue Code of 1986 to
allow a deduction to individuals for amounts contributed to health
savings security accounts and health savings accounts, to provide for
the disposition of unused health benefits in cafeteria plans and
flexible spending arrangements, and for other purposes, and ask for its
immediate consideration.
The Clerk read the title of the bill.
The text of H.R. 2596 is as follows:

H.R. 2596

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 ``Health Savings and
Affordability Act of 2003''.

SEC. 2. HEALTH SAVINGS SECURITY ACCOUNTS AND HEALTH SAVINGS
ACCOUNTS.

(a) In General.--Part VII of subchapter B of chapter 1 of
the Internal Revenue Code of 1986 (relating to additional
itemized deductions for individuals) is amended by
redesignating section 223 as section 225 and by inserting
after section 222 the following new sections:

``SEC. 223. HEALTH SAVINGS SECURITY ACCOUNTS.

``(I) is entitled to a deduction for a dependent under
section 151(c) (or would be so entitled but for paragraph (2)
or (4) of section 152(e)), or
``(II) files a joint return, and

``(C) zero in any other case.
``(3) Additional contributions for individuals 55 or
older.--
``(A) In general.--In the case of an individual who has
attained the age of 55 before the close of the taxable year,
paragraph (2) shall be applied by increasing the $2,000
amount in paragraph (2)(A) and the $4,000 amount in paragraph
(2)(B) by the additional contribution amount.
``(B) Additional contribution amount.--For purposes of this
section, the additional contribution amount is the amount
determined in accordance with the following table:

``For taxable years The additional
beginning in: contribution amount is:
2004........................................................$500 ....

2005........................................................$600 ....

2006........................................................$700 ....

2007........................................................$800 ....

2008........................................................$900 ....

2009 and thereafter.......................................$1,000.....

``(4) Limitation based on adjusted gross income.--
``(A) Self-only coverage.--The dollar amount in paragraph
(2)(A) (as increased under paragraph (3)) shall be reduced
(but not below zero) by an amount which bears the same ratio
to such dollar amount as--
``(i) the amount (if any) by which the taxpayer's adjusted
gross income for such taxable year exceeds $75,000 ($150,000
in the case of a joint return), bears to
``(ii) $10,000 ($20,000 in the case of a joint return).
``(B) Family coverage.--The dollar amount in paragraph
(2)(B) (as increased under paragraph (3)) shall be reduced
(but not below zero) by an amount which bears the same ratio
to such dollar amount as--
``(i) the amount (if any) by which the taxpayer's adjusted
gross income for such taxable year exceeds $150,000, bears to
``(ii) $20,000.
``(C) No reduction below $200 until complete phase-out.--No
dollar amount shall be reduced below $200 under subparagraph
(A) or (B) unless (without regard to this subparagraph) such
limitation is reduced to zero.
``(D) Rounding.--Any amount determined under this paragraph
which is not a multiple of $10 shall be rounded to the next
lowest $10.
``(E) Adjusted gross income.--For purposes of this
paragraph, adjusted gross income shall be determined--
``(i) without regard to this section or section 911, and
``(ii) after application of sections 86, 135, 137, 219,
221, 222, and 469.
``(5) Coordination with other contributions.--The
limitation which would (but for this paragraph) apply under
this subsection to the taxpayer for any taxable year shall be
reduced (but not below zero) by the sum of--
``(A) the aggregate amount paid during such taxable year to
Archer MSAs of such individual,
``(B) the aggregate amount paid during such taxable year to
health savings accounts of such individual, and
``(C) the aggregate amount paid during such taxable year to
health savings security accounts of such individual by
persons other than such individual.
``(6) Special rules for married individuals, dependents,
and medicare eligible individuals.--Rules similar to the
rules of

[[Page H5993]]

paragraphs (3), (6), and (7) of section 220(b) shall apply
for purposes of this section.
``(c) Definitions.--For purposes of this section--
``(1) Eligible individual.--
``(A) In general.--The term `eligible individual' means,
with respect to any month, any individual unless such
individual is covered, as of the first day of such month,
under any health plan which is not a minimum deductible plan.
``(B) Certain coverage disregarded.--Subparagraph (A) shall
be applied without regard to--
``(i) coverage for any benefit provided by permitted
insurance, and
``(ii) coverage (whether through insurance or otherwise)
for accidents, disability, dental care, vision care, or long-
term care.
``(2) Minimum deductible plan.--
``(A) In general.--The term `minimum deductible plan' means
a health plan--
``(i) in the case of self-only coverage, which has an
annual deductible which is not less than $500, and
``(ii) in the case of family coverage, which has an annual
deductible which is not less than twice the dollar amount in
clause (i) (as increased under subparagraph (B)).
``(B) Cost-of-living adjustment for annual deductibles.--
``(i) In general.--In the case of any taxable year
beginning in a calendar year after 2004, the $500 amount in
subparagraph (A)(i) shall be increased by an amount equal
to--

``(I) such dollar amount, multiplied by
``(II) the cost-of-living adjustment determined under
section 1(f)(3) for the calendar year in which such taxable
year begins by substituting `calendar year 2003' for
`calendar year 1992' in subparagraph (B) thereof.

``(ii) Rounding.--If any increase under clause (i) is not a
multiple of $50, such increase shall be rounded to the
nearest multiple of $50.
``(C) Special rules.--
``(i) Exclusion of certain plans.--Such term does not
include a health plan if substantially all of its coverage is
coverage described in paragraph (1)(B).
``(ii) Safe harbor for absence of preventive care
deductible.--A plan shall not fail to be treated as a minimum
deductible plan by reason of failing to have a deductible for
preventive care.
``(3) Uninsured.--An individual shall be treated as
uninsured if such individual is not covered by insurance
which constitutes medical care. The preceding sentence shall
be applied without regard to the coverage described in
paragraph (1)(B).
``(4) Permitted insurance.--The term `permitted insurance'
has the meaning given such term in section 220(c)(3).
``(5) Family coverage.--The term `family coverage' has the
meaning given such term in section 220(c)(5).
``(6) Archer msa.--The term `Archer MSA' has the meaning
given such term in section 220(d).
``(7) Health Savings Account.--The term `health savings
account' has the meaning given such term in section 224(d).
``(d) Health Savings Security Account.--For purposes of
this section--
``(1) In general.--The term `health savings security
account' means a trust created or organized in the United
States as a health savings security account exclusively for
the purpose of paying the qualified medical expenses of the
account beneficiary, but only if the written governing
instrument creating the trust meets the following
requirements:
``(A) Except in the case of a rollover contribution from an
Archer MSA, or a health savings security account, which is
not includible in gross income, no contribution will be
accepted--
``(i) unless it is in cash and is contributed by--

``(I) the account beneficiary,
``(II) a member of the family of the account beneficiary,
or
``(III) an employer of the account beneficiary, and

``(ii) to the extent such contribution, when added to
previous contributions to the trust for the calendar year,
exceeds the highest annual limitation which could apply to an
individual under subsection (b) for a taxable year beginning
in such calendar year.
``(B) The trustee is a bank (as defined in section 408(n)),
an insurance company (as defined in section 816), or another
person who demonstrates to the satisfaction of the Secretary
that the manner in which such person will administer the
trust will be consistent with the requirements of this
section.
``(C) No part of the trust assets will be invested in life
insurance contracts.
``(D) The assets of the trust will not be commingled with
other property except in a common trust fund or common
investment fund.
``(E) The interest of an individual in the balance in his
account is nonforfeitable.
``(2) Member of the family.--The term `member of the
family' has the meaning given such term in section
2032A(e)(2).
``(3) Qualified medical expenses.--The term `qualified
medical expenses' has the meaning given such term in section
220(d)(2), except that--
``(A) subparagraph (B)(i) thereof shall not apply to--
``(i) insurance which constitutes a minimum deductible plan
if no portion of the cost of such insurance is paid by an
employer or former employer of the account beneficiary or the
spouse of such beneficiary, and
``(ii) any health insurance (other than health insurance
substantially all of its coverage is coverage described in
subsection (c)(1)(B)) if the account beneficiary has attained
age 65, and
``(B) subparagraph (C) thereof shall not apply for purposes
of this section.
``(4) Account beneficiary.--The term `account beneficiary'
means the individual on whose behalf the health savings
security account was established.
``(5) Certain rules to apply.--Rules similar to the
following rules shall apply for purposes of this section:
``(A) Section 219(d)(2) (relating to no deduction for
rollovers).
``(B) Section 219(f)(3) (relating to time when
contributions deemed made).
``(C) Except as provided in section 106(d), section
219(f)(5) (relating to employer payments).
``(D) Section 408(g) (relating to community property laws).
``(E) Section 408(h) (relating to custodial accounts).
``(6) Contributions from flexible spending accounts treated
as made by the employer.--Any contribution from a flexible
spending account to a health savings security account which
is not includible in the gross income of the employee by
reason of section 125(h) shall be treated as a contribution
made by the employer for purposes of this section.
``(e) Tax Treatment of Accounts.--
``(1) In general.--A health savings security account is
exempt from taxation under this subtitle unless such account
has ceased to be a health savings security account.
Notwithstanding the preceding sentence, any such account is
subject to the taxes imposed by section 511 (relating to
imposition of tax on unrelated business income of charitable,
etc. organizations).
``(2) Account terminations.--Rules similar to the rules of
paragraphs (2) and (4) of section 408(e) shall apply to
health savings security accounts, and any amount treated as
distributed under such similar rules shall be treated as not
used to pay qualified medical expenses.
``(f) Tax Treatment of Distributions.--
``(1) Amounts used for qualified medical expenses.--Any
amount paid or distributed out of a health savings security
account which is used exclusively to pay qualified medical
expenses of any account beneficiary shall not be includible
in gross income.
``(2) Inclusion of amounts not used for qualified medical
expenses.--
``(A) In general.--Any amount paid or distributed out of a
health savings security account which is not used exclusively
to pay the qualified medical expenses of the account
beneficiary shall be included in the gross income of such
beneficiary in the manner provided under section 72.
``(B) Special rules for applying section 72.--For purposes
of applying section 72 to any amount described in
subparagraph (A)--
``(i) all health savings security accounts shall be treated
as 1 contract,
``(ii) all distributions during any taxable year shall be
treated as 1 distribution,
``(iii) the value of the contract, income on the contract,
and investment in the contract shall be computed as of the
close of the calendar year in which the taxable year begins,
and
``(iv) such distributions shall be treated as made from
contributions from members of the family of the account
beneficiary to the extent that such distribution, when added
to all previous distributions from the health savings
security account taken into account under this clause, do not
exceed the aggregate contributions from members of such
family.
``(3) Excess contributions returned before due date of
return.--
``(A) In general.--If any excess contribution is
contributed for a taxable year to any health savings security
account of an individual, paragraph (2) shall not apply to
distributions from the health savings security accounts of
such individual (to the extent such distributions do not
exceed the aggregate excess contributions to all such
accounts of such individual for such year) if--
``(i) such distribution is made on or before the last day
prescribed by law (including extensions of time) for filing
the account beneficiary's return for such taxable year,
``(ii) no deduction is allowed under this section with
respect to such contribution,
``(iii) such distribution is accompanied by the amount of
net income attributable to such excess contribution, and
``(iv) such distribution satisfies the requirements of
subparagraph (B).
``(B) Rules related to ordering.--
``(i) Distributions limited to contributions.--Subparagraph
(A) shall apply to distributions to a person only to the
extent of the contributions of such person to such accounts
during such taxable year.
``(ii) Classes of contributors.--Subparagraph (A) shall
apply only to distributions of such contributions which are
made in the following order:

``(I) first, to members of the family of the account
beneficiary,
``(II) second, to the account beneficiary,
``(III) third, to employers of the account beneficiary with
respect to contributions under section 125(h), and
``(IV) fourth, to employers of the account beneficiary with
respect to contributions under section 106(d).

[[Page H5994]]

most recent excess contribution which has not been
distributed to the contributor.
``(C) Treatment of net income.--Any net income described in
subparagraph (A)(iii) shall be included in the gross income
of the person receiving the distribution for the taxable year
in which received.
``(D) Excess contribution.--For purposes of subparagraph
(A), the term `excess contribution' means any contribution
(other than a rollover contribution from another health
savings security account, or from an Archer MSA, which is not
includible in gross income) to the extent such contribution
results in the aggregate contributions to health savings
security accounts of the account beneficiary for the taxable
year to be in excess of the limitation under subsection (b)
(determined without regard to paragraph (5)(C) thereof) which
applies to such beneficiary for such year.
``(4) Additional tax on distributions not used for
qualified medical expenses.--
``(A) In general.--The tax imposed by this chapter on the
account beneficiary for any taxable year in which there is a
payment or distribution from a health savings security
account of such beneficiary which is includible in gross
income under paragraph (2) shall be increased by 15 percent
of the amount which is so includible.
``(B) Exception for disability or death.--Subparagraph (A)
shall not apply if the payment or distribution is made after
the account beneficiary becomes disabled within the meaning
of section 72(m)(7) or dies.
``(C) Exception for distributions after medicare
eligibility.--Subparagraph (A) shall not apply to any payment
or distribution after the date on which the account
beneficiary attains the age specified in section 1811 of the
Social Security Act.
``(5) Rollover contribution.--
``(A) In general.--Paragraph (2) shall not apply to any
amount paid or distributed from a health savings security
account to the account beneficiary to the extent the amount
received is paid into a health savings security account, or a
health savings account, for the benefit of such beneficiary
not later than the 60th day after the day on which the
beneficiary receives the payment or distribution.
``(B) Limitation.--This paragraph shall not apply to any
amount described in subparagraph (A) received by an
individual from a health savings security account if, at any
time during the 1-year period ending on the day of such
receipt, such individual received any other amount described
in subparagraph (A) from a health savings security account
which was not includible in the individual's gross income
because of the application of this paragraph.
``(6) Special rules.--Rules similar to the rules of
paragraphs (6), (7), and (8) of section 220(f) shall apply
for purposes of this section.
``(g) Reports.--The Secretary may require the trustee of a
health savings security account to make such reports
regarding such account to the Secretary and to the account
beneficiary with respect to contributions, distributions, and
such other matters as the Secretary determines appropriate.
The reports required by this subsection shall be filed at
such time and in such manner and furnished to such
individuals at such time and in such manner as may be
required by the Secretary.
``(h) Regulations.--The Secretary may issue regulations to
carry out the purposes of this section, including regulations
regarding the proper treatment of distributions described in
subsection (f)(3) and nondeductible contributions by members
of the family of the account beneficiary.

``SEC. 224. HEALTH SAVINGS ACCOUNTS.

``(a) Deduction Allowed.--In the case of an individual who
is an eligible individual for any month during the taxable
year, there shall be allowed as a deduction for the taxable
year an amount equal to the aggregate amount paid in cash
during such taxable year by such individual to a health
savings account of such individual.
``(b) Limitations.--
``(1) In general.--The amount allowable as a deduction
under subsection (a) to an individual for the taxable year
shall not exceed the sum of the monthly limitations for
months during such taxable year that the individual is an
eligible individual.
``(2) Monthly limitation.--The monthly limitation 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.
``(3) Coordination with other contributions.--The
limitation which would (but for this paragraph) apply under
this subsection to the taxpayer for any taxable year shall be
reduced (but not below zero) by the sum of--
``(A) the aggregate amount paid during such taxable year to
Archer MSAs of such individual,
``(B) the aggregate amount paid during such taxable year to
health savings security accounts of such individual, and
``(C) the aggregate amount paid during such taxable year to
health savings accounts of such individual by persons other
than such individual.
``(4) Special rules for married individuals, dependents,
and medicare eligible individuals.--Rules similar to the
rules of paragraphs (3), (6), and (7) of section 220(b) shall
apply for purposes of this section.
``(c) Definitions.--For purposes of this section--
``(1) Eligible individual.--
``(A) In general.--The term `eligible individual' 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 covered under a high
deductible health plan, covered under any health plan--

``(I) which is not a high deductible health plan, and
``(II) which provides coverage for any benefit which is
covered under the high deductible health plan.

``(B) Certain coverage disregarded.--Subparagraph (A)(ii)
shall be applied without regard to--
``(i) coverage for any benefit provided by permitted
insurance, and
``(ii) coverage (whether through insurance or otherwise)
for accidents, disability, dental care, vision care, or long-
term care.
``(2) High deductible health plan.--
``(A) In general.--The term `high deductible health plan'
means a health plan--
``(i) in the case of self-only coverage, which has an
annual deductible which is not less than $1,000 and not more
than $2,250,
``(ii) in the case of family coverage, which has an annual
deductible which is not less than $2,000 and not more than
$4,500, and
``(iii) the annual out-of-pocket expenses required to be
paid under the plan (other than for premiums) for covered
benefits does not exceed--

``(I) $3,000 for self-only coverage, and
``(II) $5,500 for family coverage.

``(B) Cost-of-living adjustment.--
``(i) In general.--In the case of any taxable year
beginning in a calendar year after 1998, each dollar amount
in subparagraph (A) shall be increased by an amount equal
to--

``(I) such dollar amount, multiplied by
``(II) the cost-of-living adjustment determined under
section 1(f)(3) for the calendar year in which such taxable
year begins by substituting `calendar year 1997' for
`calendar year 1992' in subparagraph (B) thereof.

``(ii) Special rules.--In the case of the $1,000 amount in
subparagraph (A)(i) and the $2,000 amount in subparagraph
(A)(ii), subclause (i)(II) shall be applied by substituting
`calendar year 2002' for `calendar year 1997'.
``(iii) Rounding.--If any increase under clause (i) or (ii)
is not a multiple of $50, such increase shall be rounded to
the nearest multiple of $50.
``(C) Special rules.--
``(i) Exclusion of certain plans.--Such term does not
include a health plan if substantially all of its coverage is
coverage described in paragraph (1)(B).
``(ii) Safe harbor for absence of preventive care
deductible.-- A plan shall not fail to be treated as a high
deductible health plan by reason of failing to have a
deductible for preventive care.
``(D) Treatment of network services.--
``(i) In general.--In the case of a health plan which is a
preferred provider organization plan and which would (without
regard to services provided outside such organization's
network of providers described in clause (iii)(I)) be a high
deductible health plan, such plan shall not fail to be a high
deductible health plan because--

``(I) the annual deductible for services provided outside
such network exceeds the applicable maximum dollar amount in
clause (i) or (ii) of subparagraph (A), or
``(II) the annual out-of-pocket expenses required to be
paid for services provided outside such network exceeds the
applicable dollar amount in subparagraph (A)(iii).

``(ii) Annual deductible.--The annual deductible taken into
account under subsection (b)(2) with respect to a plan which
is a high deductible health plan by reason of clause (i)
shall be the annual deductible for services provided within
such network.
``(iii) Preferred provider organization plan defined.--In
this subparagraph, the term `preferred provider organization
plan' means a health plan that--

``(I) has a network of providers that have agreed to a
contractually specified reimbursement for covered benefits
with the organization offering the plan,
``(II) provides for reimbursement for all covered benefits
regardless of whether such benefits are provided within such
network of providers, and
``(III) is offered by an organization that is not licensed
or organized under State law as a health maintenance
organization.

``(3) Permitted insurance.--The term `permitted insurance'
has the meaning given such term in section 220(c)(3).
``(4) Family coverage.--The term `family coverage' has the
meaning given such term in section 220(c)(5).
``(5) Archer msa.--The term `Archer MSA' has the meaning
given such term in section 220(d).
``(6) Health savings security account.--The term `health
savings security account' has the meaning given such term in
section 223(d).
``(d) Health Savings Account.--For purposes of this
section--
``(1) In general.--The term `health savings account' means
a trust created or organized in the United States as a health
savings account exclusively for the purpose of paying the
qualified medical expenses of the account beneficiary, but
only if the written governing instrument creating the trust
meets the following requirements:

[[Page H5995]]

``(A) Except in the case of a rollover contribution from an
Archer MSA, a health savings security account, or a health
savings account, which is not includible in gross income, no
contribution will be accepted--
``(i) unless it is in cash and is contributed by--

``(I) the account beneficiary, or
``(II) an employer of the account beneficiary, and

``(ii) to the extent such contribution, when added to
previous contributions to the trust for the calendar year,
exceeds the highest annual limitation which could apply to an
individual under subsection (b) for a taxable year beginning
in such calendar year.
``(B) The trustee is a bank (as defined in section 408(n)),
an insurance company (as defined in section 816), or another
person who demonstrates to the satisfaction of the Secretary
that the manner in which such person will administer the
trust will be consistent with the requirements of this
section.
``(C) No part of the trust assets will be invested in life
insurance contracts.
``(D) The assets of the trust will not be commingled with
other property except in a common trust fund or common
investment fund.
``(E) The interest of an individual in the balance in his
account is nonforfeitable.
``(2) Qualified medical expenses.--The term `qualified
medical expenses' has the meaning given such term in section
220(d)(2).
``(3) Account beneficiary.--The term `account beneficiary'
means the individual on whose behalf the health savings
account was established.
``(4) Certain rules to apply.--Rules similar to the
following rules shall apply for purposes of this section:
``(A) Section 219(d)(2) (relating to no deduction for
rollovers).
``(B) Section 219(f)(3) (relating to time when
contributions deemed made).
``(C) Except as provided in section 106(d), section
219(f)(5) (relating to employer payments).
``(D) Section 408(g) (relating to community property laws).
``(E) Section 408(h) (relating to custodial accounts).
``(6) Contributions from flexible spending accounts treated
as made by the employer.--Any contribution from a flexible
spending account to a health savings account which is not
includible in the gross income of the employee by reason of
section 125(h) shall be treated as a contribution made by the
employer for purposes of this section.
``(e) Tax Treatment of Accounts.--
``(1) In general.--A health savings account is exempt from
taxation under this subtitle unless such account has ceased
to be a health savings account. Notwithstanding the preceding
sentence, any such account is subject to the taxes imposed by
section 511 (relating to imposition of tax on unrelated
business income of charitable, etc. organizations).
``(2) Account terminations.--Rules similar to the rules of
paragraphs (2) and (4) of section 408(e) shall apply to
health savings accounts, and any amount treated as
distributed under such rules shall be treated as not used to
pay qualified medical expenses.
``(f) Tax Treatment of Distributions.--
``(1) Amounts used for qualified medical expenses.--Any
amount paid or distributed out of a health savings account
which is used exclusively to pay qualified medical expenses
of any account beneficiary shall not be includible in gross
income.
``(2) Inclusion of amounts not used for qualified medical
expenses.--Any amount paid or distributed out of a health
savings account which is not used exclusively to pay the
qualified medical expenses of the account beneficiary shall
be included in the gross income of such beneficiary.
``(3) Excess contributions returned before due date of
return.--
``(A) In general.--If any excess contribution is
contributed for a taxable year to any health savings account
of an individual, paragraph (2) shall not apply to
distributions from the health savings accounts of such
individual (to the extent such distributions do not exceed
the aggregate excess contributions to all such accounts of
such individual for such year) if--
``(i) such distribution is made on or before the last day
prescribed by law (including extensions of time) for filing
the account beneficiary's return for such taxable year,
``(ii) no deduction is allowed under this section with
respect to such contribution,
``(iii) such distribution is accompanied by the amount of
net income attributable to such excess contribution, and
``(iv) such distribution satisfies the requirements of
subparagraph (B).
``(B) Rules related to ordering.--
``(i) Distributions limited to contributions.--Subparagraph
(A) shall apply to distributions to a person only to the
extent of the contributions of such person to such accounts
during such taxable year.
``(ii) Classes of contributors.--Subparagraph (A) shall
apply only to distributions of such contributions which are
made in the following order:

``(I) first, to the account beneficiary,
``(II) second, to employers of the account beneficiary with
respect to contributions under section 125(h), and
``(III) third, to employers of the account beneficiary with
respect to contributions under section 106(d).

``(iii) Last-in first-out.--If distributions could be made
to more than one person under any subclause of clause (ii),
subparagraph (A) shall not apply to any such distribution
unless such distribution is of the most recent excess
contribution which has not been distributed to the
contributor.
``(C) Treatment of net income.--Any net income described in
subparagraph (A)(iii) shall be included in the gross income
of the person receiving the distribution for the taxable year
in which received.
``(D) Excess contribution.--For purposes of subparagraph
(A), the term `excess contribution' means any contribution
(other than a rollover contribution from another health
savings account, from a health savings security account, or
from an Archer MSA, which is not includible in gross income)
to the extent such contribution results in the aggregate
contributions to health savings accounts of the account
beneficiary for the taxable year to be in excess of the
limitation under subsection (b) (determined without regard to
paragraph (3)(C) thereof) which applies to such beneficiary
for such year.
``(4) Additional tax on distributions not used for
qualified medical expenses.--
``(A) In general.--The tax imposed by this chapter on the
account beneficiary for any taxable year in which there is a
payment or distribution from a health savings account of such
beneficiary which is includible in gross income under
paragraph (2) shall be increased by 15 percent of the amount
which is so includible.
``(B) Exception for disability or death.--Subparagraph (A)
shall not apply if the payment or distribution is made after
the account beneficiary becomes disabled within the meaning
of section 72(m)(7) or dies.
``(C) Exception for distributions after medicare
eligibility.--Subparagraph (A) shall not apply to any payment
or distribution after the date on which the account
beneficiary attains the age specified in section 1811 of the
Social Security Act.
``(5) Rollover contribution.--
``(A) In general.--Paragraph (2) shall not apply to any
amount paid or distributed from a health savings account to
the account beneficiary to the extent the amount received is
paid into a health savings account for the benefit of such
beneficiary not later than the 60th day after the day on
which the beneficiary receives the payment or distribution.
``(B) Limitation.--This paragraph shall not apply to any
amount described in subparagraph (A) received by an
individual from a health savings account if, at any time
during the 1-year period ending on the day of such receipt,
such individual received any other amount described in
subparagraph (A) from a health savings account which was not
includible in the individual's gross income because of the
application of this paragraph.
``(6) Special rules.--Rules similar to the rules of
paragraphs (6), (7), and (8) of section 220(f) shall apply
for purposes of this section.
``(g) Reports.--The Secretary may require the trustee of a
health savings account to make such reports regarding such
account to the Secretary and to the account beneficiary with
respect to contributions, distributions, and such other
matters as the Secretary determines appropriate. The reports
required by this subsection shall be filed at such time and
in such manner and furnished to such individuals at such time
and in such manner as may be required by the Secretary.''.
(b) Deduction Allowed Whether or Not Individual Itemizes
Other Deductions.--Subsection (a) of section 62 of such Code
is amended by inserting after paragraph (18) the following
new paragraphs:
``(19) Health savings security accounts.--The deduction
allowed by section 223.
``(20) Health savings accounts.--The deduction allowed by
section 224.''.
(c) Coordination With Archer MSAs.--
(1) Rollovers from archer msas permitted.--Subparagraph (A)
of section 220(f)(5) of such Code (relating to rollover
contribution) is amended by inserting ``, a health savings
security account (as defined in section 223(d)), or a health
savings account (as defined in section 224(d)),'' after
``paid into an Archer MSA''.
(2) Reduction in archer msa limitation for contributions to
health savings security accounts and health savings
accounts.--Subsection (b) of section 220 of such Code
(relating to limitations) is amended by adding at the end the
following new paragraph:
``(8) Coordination with health savings security accounts
and health savings accounts.--The limitation which would (but
for this paragraph) apply under this subsection to the
taxpayer for any taxable year shall be reduced (but not below
zero) by the sum of--
``(A) the aggregate amount paid during such taxable year to
health savings security accounts of such individual, and
``(B) the aggregate amount paid during such taxable year to
health savings accounts of such individual.''.
(d) Exclusions for Employer Contributions to Health Savings
Security Accounts and Health Savings Accounts.--
(1) Exclusion from income tax.--Section 106 of such Code
(relating to contributions by employer to accident and health
plans) is amended by adding at the end the following new
subsections:
``(d) Contributions to Health Savings Security Accounts.--
``(1) In general.--In the case of an employee who is an
eligible individual, amounts contributed by such employee's
employer to

[[Page H5996]]

any health savings security account of such employee shall be
treated as employer-provided coverage for medical expenses
under an accident or health plan to the extent such amounts
do not exceed the limitation under section 223(b) (determined
without regard to this subsection) which is applicable to
such employee for such taxable year.
``(2) Special rules.--Rules similar to the rules of
paragraphs (2), (3), (4), and (5) of subsection (b) shall
apply for purposes of this subsection.
``(3) Definitions.--For purposes of this subsection, the
terms `eligible individual' and `health savings security
account' have the respective meanings given to such terms by
section 223.
``(4) Cross reference.--

``For penalty on failure by employer to make comparable contributions
to the health savings security accounts of comparable employees, see
section 4980G.

``(e) Contributions to Health Savings Accounts.--
``(1) In general.--In the case of an employee who is an
eligible individual, amounts contributed by such employee's
employer to any health savings account of such employee shall
be treated as employer-provided coverage for medical expenses
under an accident or health plan to the extent such amounts
do not exceed the limitation under section 224(b) (determined
without regard to this subsection) which is applicable to
such employee for such taxable year.
``(2) Special rules.--Rules similar to the rules of
paragraphs (2), (3), (4), and (5) of subsection (b) shall
apply for purposes of this subsection.
``(3) Definitions.--For purposes of this subsection, the
terms `eligible individual' and `health savings account' have
the respective meanings given to such terms by section 224.
``(4) Cross reference.--

``For penalty on failure by employer to make comparable contributions
to the health savings accounts of comparable employees, see section
4980G.''.

(2) Exclusion from employment taxes.--
(A) Railroad retirement tax.--Subsection (e) of section
3231 of such Code is amended by adding at the end the
following new paragraph:
``(11) Health savings security account and health savings
account contributions.--The term `compensation' shall not
include any payment made to or for the benefit of an employee
if at the time of such payment it is reasonable to believe
that the employee will be able to exclude such payment from
income under subsection (d) or (e) of section 106.''.
(B) Unemployment tax.--Subsection (b) of section 3306 of
such Code is amended by striking ``or'' at the end of
paragraph (16), by striking the period at the end of
paragraph (17) and inserting ``; or'', and by inserting after
paragraph (17) the following new paragraph:
``(18) any payment made to or for the benefit of an
employee if at the time of such payment it is reasonable to
believe that the employee will be able to exclude such
payment from income under subsection (d) or (e) of section
106.''.
(C) Withholding tax.--Subsection (a) of section 3401 of
such Code is amended by striking ``or'' at the end of
paragraph (20), by striking the period at the end of
paragraph (21) and inserting ``; or'', and by inserting after
paragraph (21) the following new paragraph:
``(22) any payment made to or for the benefit of an
employee if at the time of such payment it is reasonable to
believe that the employee will be able to exclude such
payment from income under subsection (d) or (e) of section
106.''
(3) Employer contributions required to be shown on w-2.--
Subsection (a) of section 6051 of such Code is amended by
striking ``and'' at the end of paragraph (10), by striking
the period at the end of paragraph (11) and inserting a
comma, and by inserting after paragraph (11) the following
new paragraphs:
``(12) the amount contributed to any health savings
security account (as defined in section 223(d)) of such
employee or such employee's spouse, and
``(13) the amount contributed to any health savings account
(as defined in section 224(d)) of such employee or such
employee's spouse.''.
(4) Penalty for failure of employer to make comparable
health savings account contributions.--
(A) In general.--Chapter 43 of such Code is amended by
adding after section 4980F the following new section:

``SEC. 4980G. FAILURE OF EMPLOYER TO MAKE COMPARABLE HEALTH
SAVINGS ACCOUNT CONTRIBUTIONS.

``(a) General Rule.--In the case of an employer who makes a
contribution to the health savings security account or the
health savings account of any employee during a calendar
year, there is hereby imposed a tax on the failure of such
employer to meet the requirements of subsection (b) for such
calendar year.
``(b) Rules and Requirements.--Rules and requirements
similar to the rules and requirements of section 4980E shall
apply for purposes of this section.
``(c) Regulations.--The Secretary shall issue regulations
to carry out the purposes of this section, including
regulations providing special rules for employers who make
contributions to more than one of the following types of
accounts during the calendar year:
``(1) An Archer MSA.
``(2) A health savings security account.
``(3) A health savings account.''.
(B) Clerical amendment.--The table of sections for chapter
43 of such Code is amended by adding after the item relating
to section 4980F the following new item:

``Sec. 4980G. Failure of employer to make comparable health savings
account contributions.''.

(e) Tax on Excess Contributions.--Section 4973 of such Code
(relating to tax on excess contributions to certain tax-
favored accounts and annuities) is amended--
(1) by striking ``or'' at the end of paragraph (3) of
subsection (a),
(2) by inserting after paragraph (4) of subsection (a) the
following new paragraphs:
``(5) a health savings security account (within the meaning
of section 223(d)), or
``(6) a health savings account (within the meaning of
section 224(d))'', and
(4) by adding at the end the following new subsections:
``(g) Excess Contributions to Health Savings Security
Accounts.--For purposes of this section, in the case of
health savings security accounts (within the meaning of
section 223(d)), the term `excess contributions' means the
sum of--
``(1) the aggregate amount contributed for the taxable year
to the accounts (other than a rollover contribution from
another health savings security account, or from an Archer
MSA, which is not includible in gross income) which is in
excess of the limitation under section 223(b) (determined
without regard to paragraph (5)(C) thereof), and
``(2) the amount determined under this subsection for the
preceding taxable year, reduced by the sum of--
``(A) the distributions out of the accounts which were
included in gross income under section 223(f)(2), and
``(B) the excess (if any) of--
``(i) the sum of limitations described in paragraph (1),
over
``(ii) the amount contributed to the accounts for the
taxable year.

For purposes of this subsection, any contribution which is
distributed out of the health savings security account in a
distribution to which section 223(f)(3) applies shall be
treated as an amount not contributed.
``(h) Excess Contributions to Health Savings Accounts.--For
purposes of this section, in the case of health savings
accounts (within the meaning of section 224(d)), the term
`excess contributions' means the sum of--
``(1) the aggregate amount contributed for the taxable year
to the accounts (other than a rollover contribution from
another health savings account, a health savings security
account, or from an Archer MSA, which is not includible in
gross income) which is in excess of the limitation under
section 224(b) (determined without regard to paragraph (3)(C)
thereof), and
``(2) the amount determined under this subsection for the
preceding taxable year, reduced by the sum of--
``(A) the distributions out of the accounts which were
included in gross income under section 224(f)(2), and
``(B) the excess (if any) of--
``(i) the sum of limitations described in paragraph (1),
over
``(ii) the amount contributed to the accounts for the
taxable year.

For purposes of this subsection, any contribution which is
distributed out of the health savings account in a
distribution to which section 224(f)(3) applies shall be
treated as an amount not contributed.''.
(f) Tax on Prohibited Transactions.--
(1) Section 4975 of such Code (relating to tax on
prohibited transactions) is amended by adding at the end of
subsection (c) the following new paragraphs:
``(6) Special rule for health savings security accounts.--
An individual for whose benefit a health savings security
account (within the meaning of section 223(d)) is established
shall be exempt from the tax imposed by this section with
respect to any transaction concerning such account (which
would otherwise be taxable under this section) if, with
respect to such transaction, the account ceases to be a
health savings security account by reason of the application
of section 223(e)(2) to such account.
``(7) Special rule for health savings accounts.--An
individual for whose benefit a health savings account (within
the meaning of section 224(d)) is established shall be exempt
from the tax imposed by this section with respect to any
transaction concerning such account (which would otherwise be
taxable under this section) if, with respect to such
transaction, the account ceases to be a health savings
account by reason of the application of section 224(e)(2) to
such account.''.
(2) Paragraph (1) of section 4975(e) of such Code is
amended by redesignating subparagraphs (E) and (F) as
subparagraphs (G) and (H), respectively, and by inserting
after subparagraph (D) the following new subparagraphs:
``(E) a health savings security account described in
section 223(d),
``(F) a health savings account described in section
224(d),''.
(g) Failure To Provide Reports on Health Savings
Accounts.--Paragraph (2)

[[Page H5997]]

of section 6693(a) of such Code (relating to reports) is
amended by redesignating subparagraphs (C) and (D) as
subparagraphs (E) and (F), respectively, and by inserting
after subparagraph (B) the following new subparagraphs:
``(C) section 223(g) (relating to health savings security
accounts),
``(D) section 224(g) (relating to health savings
accounts),''.
(h) Exception From Capitalization of Policy Acquisition
Expenses.--Subparagraph (B) of section 848(e)(1) of such Code
(defining specified insurance contract) is amended by
striking ``and'' at the end of clause (iii), by striking the
period at the end of clause (iv) and inserting a comma, and
by adding at the end the following new clauses:
``(v) any contract which is a health savings security
account (as defined in section 223(d)), and''.
``(vi) any contract which is a health savings account (as
defined in section 224(d)).''.
(i) Health Savings Security Accounts and Health Savings
Accounts May Be Offered Under Cafeteria Plans.--Paragraph (2)
of section 125(d) (relating to cafeteria plan defined) is
amended by adding at the end the following new subparagraph:
``(D) Exception for health savings accounts.--Subparagraph
(A) shall not apply to a plan to the extent of amounts which
a covered employee may elect to have the employer pay as
contributions to a health savings security account, or a
health savings account, established on behalf of the
employee.''.
(j) Information Reporting by Providers of Health
Insurance.--Subpart B of part III of subchapter A of chapter
61 of such Code is amended by adding at the end the following
new section:

``SEC. 6050U. RETURNS RELATING TO PROVIDERS OF HEALTH
INSURANCE.

``(a) Requirement of Reporting.--Under regulations
prescribed by the Secretary, every person who provides any
individual with coverage under a plan which constitutes
medical care shall, at such time as the Secretary may
prescribe, make the return described in subsection (b) with
respect to such individual.
``(b) Form and Manner of Returns.--A return is described in
this subsection if such return--
``(1) is in such form as the Secretary may prescribe, and
``(2) contains such information as the Secretary
prescribes.
``(c) Statements To Be Furnished to Individuals With
Respect to Whom Information Is Required.--Every person
required to make a return under subsection (a) shall furnish
to each individual whose name is required to be set forth in
such return a written statement showing--
``(1) the name and address of the person required to make
such return and the phone number of the information contact
for such person, and
``(2) the information required to be shown on the return
with respect to such individual.

The written statement required under the preceding sentence
shall be furnished on or before January 31 of the year
following the calendar year for which the return under
subsection (a) is required to be made.''.
(k) Conforming Amendments.--
(1) The table of sections for part VII of subchapter B of
chapter 1 of such Code is amended by striking the last item
and inserting the following:

``Sec. 223. Health savings security accounts.
``Sec. 224. Health savings accounts.
``Sec. 225. Cross reference.''.

(2)(A) Sections 86(b)(2)(A), 135(c)(4)(A), 137(b)(3)(A),
219(g)(3)(A)(ii), and 221(b)(2)(C)(i) are each amended by
inserting ``223,'' after ``222,''.
(B) Section 222(b)(2)(C)(i) is amended by inserting
``223,'' before ``911''.
(C) Section 469(i)(3)(F)(iii) is amended by striking ``and
222'' and inserting ``222, and 223''.
(l) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2003.

SEC. 3. DISPOSITION OF UNUSED HEALTH BENEFITS IN CAFETERIA
PLANS AND FLEXIBLE SPENDING ARRANGEMENTS.

(a) In General.--Section 125 of the Internal Revenue Code
of 1986 (relating to cafeteria plans) is amended by
redesignating subsections (h) and (i) as subsections (i) and
(j), respectively, and by inserting after subsection (g) the
following:
``(h) Contributions of Certain Unused Health Benefits.--
``(1) In general.--For purposes of this title, a plan or
other arrangement shall not fail to be treated as a cafeteria
plan solely because qualified benefits under such plan
include a health flexible spending arrangement under which
not more than $500 of unused health benefits may be--
``(A) carried forward to the succeeding plan year of such
health flexible spending arrangement,
``(B) to the extent permitted by sections 223 and 224,
contributed on behalf of the employee to a health savings
security account (as defined in section 223(d)), or a health
savings account (as defined in section 224(d)), maintained
for the benefit of such employee, or
``(C) contributed to a qualified retirement plan (as
defined in section 4974(c)), or an eligible deferred
compensation plan (as defined in section 457(b)) of an
eligible employer described in section 457(e)(1)(A), but only
to the extent such amount would not be allowed as a deduction
under--
``(i) section 223 if made directly by the employee to a
health savings security account of the employee (determined
without regard to any other contributions made by the
employee), and
``(ii) section 224 if made directly by the employee to a
health savings account of the employee (determined without
regard to any other contributions made by the employee).
``(2) Special rules for treatment of contributions to
retirement plans.--For purposes of this title, contributions
under paragraph (1)(C)--
``(A) shall be treated as elective deferrals (as defined in
section 402(g)(3)) in the case of contributions to a
qualified cash or deferred arrangement (as defined in section
401(k)) or to an annuity contract described in section
403(b),
``(B) shall be treated as employer contributions to which
the employee has a nonforfeitable right in the case of a plan
(other than a plan described in subparagraph (A)) which is
described in section 401(a) which includes a trust exempt
from tax under section 501(a),
``(C) shall be treated as deferred compensation in the case
of contributions to an eligible deferred compensation plan
(as defined in section 457(b)), and
``(D) shall be treated in the manner designated for
purposes of section 408 or 408A in the case of contributions
to an individual retirement plan.
``(3) Health flexible spending arrangement.--For purposes
of this subsection, the term `health flexible spending
arrangement' means a flexible spending arrangement (as
defined in section 106(c)) that is a qualified benefit and
only permits reimbursement for expenses for medical care (as
defined in section 213(d)(1) (without regard to subparagraphs
(C) and (D) thereof).
``(4) Unused health benefits.--For purposes of this
subsection, with respect to an employee, the term `unused
health benefits' means the excess of--
``(A) the maximum amount of reimbursement allowable to the
employee during a plan year under a health flexible spending
arrangement, taking into account any election by the
employee, over
``(B) the actual amount of reimbursement during such year
under such arrangement.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2003.

SEC. 4. EXCEPTION TO INFORMATION REPORTING REQUIREMENTS
RELATED TO CERTAIN HEALTH ARRANGEMENTS.

(a) In General.--Section 6041 (relating to information at
source) is amended by adding at the end the following new
subsection:
``(f) Section Does Not Apply to Certain Health
Arrangements.--This section shall not apply to any payment
for medical care (as defined in section 213(d)) made under--
``(1) a flexible spending arrangement (as defined in
section 106(c)(2)), or
``(2) a health reimbursement arrangement which is treated
as employer-provided coverage under an accident or health
plan for purposes of section 106.''.
(b) Effective Date.--The amendment made by this section
shall apply to payments made after December 31, 2002.

{time} 1715

The SPEAKER pro tempore (Mr. Sweeney). Pursuant to House Resolution
299, the gentleman from California (Mr. Thomas) and the gentleman from
New York (Mr. Rangel) each will control 30 minutes.
The Chair recognizes the gentleman from California (Mr. Thomas).
Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
This is an important day regarding all Americans' health care needs.
Most people are focused on our seniors and the Medicare legislation,
which will be before us shortly. We have before us now the Health
Savings and Affordability Act, and I first want to thank my colleague,
the gentleman from Illinois (Mr. Lipinski), for working with us in
producing a bipartisan piece of legislation, which is extremely
important to seniors accompanying the Medicare legislation, but really
to all Americans, and especially those Americans who, through no fault
of their own, today have no health insurance available to them.
This legislation creates two new savings accounts, a health savings
account and a health savings security account. The basic idea is that
people ought to be able to put their own money away, individuals,
relatives, or otherwise who wish to help them put money away, and in
particular instances, employers who adopt particular kinds of health
care plans for their employees assist in putting money away for health
care needs. These accounts will accumulate tax free and can be expended
for any health needs.
Here is the really exciting and important new twist. There is no age
limit at

[[Page H5998]]

which you have to make all of the contributions paid out of the health
savings account. It is literally lifetime assistance. Why is that
important? Because today, as we pass the new Medicare modernization
with prescription drug program, we will add tremendous new benefits,
but there are other costs associated with the bill, both in acquiring
prescription drugs and in making sure that seniors can pay for those
additional costs.
It is not right to say that every additional benefit provided to
seniors should be paid for by taxpayers. We are already in the midst of
the greatest intergenerational transfer of wealth in the history of the
world. But it is also not fair to say to hardworking Americans that
when they retire they should pay out of their own pockets if we have
not provided an easily affordable method to accumulate those dollars.
That is exactly what we have in front of us today: A health savings
account that has a multiple number of ways in which money can be placed
in to be paid for health needs not only while you are working but when
you retire. There is no absolute payout. And if there is money in it
when the senior passes, then it becomes part of an estate and that
money, in its transfer, is taxable. There is no possibility of
gimmicking the system.
The real concern is that we have told Americans oftentimes that they
have to pay for particular costs, and yet we do not provide an easy and
affordable way for them to do so. One of the big concerns we have today
is chronic or long-term care costs for seniors. Time value of money is
the best way to address a problem that is going to face most Americans.
That is exactly what health savings accounts allow you to do. It is
clearly an affordable health care cost if you have planned for it.
Unfortunately, too often today's seniors did not plan. There was not
a program convenient and easy for them to plan. This allows them, in a
prudent way, to put money away. Oftentimes we may want to help our
parents, senior children. This is a way, through a health savings
account, that they can place money available for seniors to be readily
used for health savings accounts that provide a positive, tax-free
environment for accumulating those dollars.
In so many ways, Mr. Speaker, this particular program will blend not
only with the Medicare changes that we are going to be making but in
terms of meeting the needs of today's workers as well. It is completely
portable, it is a fund that accumulates tax free, and it belongs to the
individual. They can take it with them wherever they may want to work.
Mr. Speaker, I ask unanimous consent that the control of the balance
of my time be by the gentleman from Wisconsin (Mr. Ryan).
The SPEAKER pro tempore. Without objection, the gentleman from
Wisconsin (Mr. Ryan) will control the balance of the time.
There was no objection.
Mr. RYAN of Wisconsin. Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
The chairman of the Committee on Ways and Means connected this bill
with senior citizens' inability to plan for their future. Well, I am
glad he is sending them a signal, because after what they intend to do
with seniors with the Medicare bill, somebody might have planned for
their futures.
I remember in the good old days when Republicans used to say that
they were going to travel around the country and pull the Tax Code up
by the roots. That meant they were going to close loopholes, get rid of
shelters, and to have a system that people did not have to hire
accountants and lawyers in order to know what their tax liability would
be. I even volunteered to drive around with them on these buses to see
just how they intended to put back a Code that was more equitable and
fair and one could understand.
But while the gentleman from California (Mr. Stark) still thinks that
some of them are on the level as relates to health, I asked for the
opportunity to at least open up this debate just so that people who are
not on the floor would understand that this has nothing to do with
health. It has a heck of a lot to do with wealth and more to do with
shelter. They have to find ways to make certain that the deficit gets
larger and that there is no money in the Treasury to take care of the
problems that we used to say was a Federal responsibility. How do you
do it? Just being creative.
Why, they do not even need a chairman of a Committee on the Budget
because there are no budget restrictions. Last night, this bill was
supposed to be going over to the Committee on Rules at a cost of $71
billion over 10 years. What imagination. What creativity, when just
overnight they found out that the bill really costs $171 billion. How
can Republicans be so smart that just overnight, without hearings,
without checking with Treasury, without talking with OMB they can find
$100 billion?
Now, what is the cost of $171 billion? It is simple: It means that
people who make up to $150,000 and are well do not have to pay taxes on
storing away $4,000 in a tax shelter. So if you are working for someone
and you make up to $150,000, you never have to pay taxes on the money,
whether you are sick or whether or not you retire with the money. This
is really just a tax-free grant to some of the people who are friendly
to people on the other side.
But what about the people that do not have the $4,000? Now, that is
the problem, because you are not eligible for this unless you do not
have expenses that will be paid for for $1,000. So if an employer
really cares for you and wants to have you eligible for this tax
shelter, the best favor he can do for you is to take away your health
insurance. And, of course, you make the killing on your savings by not
paying taxes. And so once he does you this favor, he has to do it for
the lesser-income people, and lo and behold, we will find that those
who cannot afford to stash away this money, because they do not have
disposable income, end up with no insurance and no savings account.
Oh, one might say this is cruel, but sensitivity never bothered the
majority party, because at the end of the game they want to know how
much of the people's money did you leave with them. Or to put it
another way, how much did you take away from the Federal Government so
that we cannot provide basic services.
So the gentleman from California (Mr. Stark) need not worry. This
savings account has nothing to do with health. It has everything to do
with shelter.
Mr. Speaker, I ask unanimous consent that the balance of my time be
turned over to the gentleman from California (Mr. Stark) and that he be
given the authority to allocate time.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from New York?
There was no objection.
The SPEAKER pro tempore. The gentleman from California (Mr. Stark)
reserves the balance of his time.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I just heard the ranking member say this is not a health
bill, that this is a tax shelter. I beg to differ. Number one, what we
are talking about here is really novel and revolutionary. We are saying
that employers and employees can together contribute to their own
savings account with pre-tax dollars, with tax- deductible dollars to
purchase health care spending and to have a catastrophic plan.
The gentleman from New York said, what about the people who do not
have $4,000 to put in their health security savings account? Well,
their employer can put $4,000 into their account. The purpose of this
reform, Mr. Speaker, is to get at some of the big issues that are
really hurting this country, and that is the cost of health insurance,
the affordability, and the accessibility of health insurance.
So what this reform does is it equips the individual in the family
with the ability to go out into the health care marketplace with tax-
deductible dollars to act like good consumers and buy their health
insurance. It gives incentives. It actually requires, on health savings
accounts, that employers provide catastrophic health insurance, or
individuals who have their own health savings accounts have
catastrophic health insurance. So it makes sure that people have health
insurance if they really run into problems. But it allows people to
manage their health care expenditures themselves.
You know, it is often said that we spend more time shopping for cars
or

[[Page H5999]]

computers than we do for our own health insurance. Well, the reforms in
this bipartisan Thomas-Lipinski bill give us those incentives to act
like good consumers so we can watch our health care dollars. Health
care inflation is out of control. Health care spending is out of
control. Premium increases facing small businesses and individuals are
out of control. We need to give consumers the ability to get it under
control. That is what this legislation does.
I am also interested in the argument that this is somehow fiscally
irresponsible. I find that kind of a unique argument, given the fact
that the gentleman from New York is about to bring a prescription drug
substitute amendment to the floor that spends $600 billion more than
the Republican plan does; a trillion dollar bill that spends a trillion
dollars on his prescription drug bill versus the $400 billion that was
paid for in the House budget resolution, as is this health savings
account legislation.
Mr. Speaker, I reserve the balance of my time so that the other side
can yield time.
Mr. STARK. Mr. Speaker, I yield myself 3 minutes.
(Mr. STARK asked and was given permission to revise and extend his
remarks.)
Mr. STARK. Mr. Speaker, I will start with an apology to all my
Republican colleagues. For, oh, at least the 30 years or so I have been
here, I have been accusing the Republicans of not being inclusive, just
dealing with the rich and forgetting about the minorities and the
working people in this country. With this bill they have become broadly
inclusive. Later on tonight, they are going to take the first step in
destroying health care for seniors, and then, because they are being so
inclusive with this bill, they are going to screw everybody. They are
going to destroy health care for the employees who get their health
insurance from employers.
As the distinguished ranking member of our committee pointed out,
$100 billion was added to this in the middle of the night, and the bill
will be funded by borrowing, by increasing the national debt and
worsening deficits. And all it really does, if you cut through all the
Mickey Mouse that they have talked about, high-deductible insurance, is
that it creates some new tax-exempt savings accounts. Tax shelters for
the wealthy and the healthy. And it advances the objective of
undercutting employer-provided health coverage.
It is no secret that the distinguished chairman of the Committee on
Ways and Means has expressed his desire to dismantle the employment-
linked health insurance system, and he has noted that he believes it
encourages overutilization of health care because individuals are
shielded from knowing the true cost.

{time} 1730

Now, the argument that the bill will assist the uninsured is not
true. Most of the uninsured have incomes too low to be eligible for any
tax benefits contained in H.R. 2596. And as was stated earlier, few, if
any, have the $4,000 a year in additional savings required to utilize
the benefits contained. There is nothing in this bill that requires the
employers to give the employees any money to make up for that gap that
will be created by the higher deductibles. It merely gives them the
opportunity, if they have any money, to add to savings accounts.
Not surprisingly, the same 6 million families who were deliberately
excluded by the Republicans from the recent tax bill for child tax
credit are the same families that they are excluding from benefiting in
this bill. So for families with insurance, it provides tax benefits
only if the insurance requires them to pay the first thousand dollars;
and employers will be encouraged by this nonsense to increase health
insurance deductibles, which lowers their costs and lowers the benefits
for most of their employees' health insurance.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield 2 minutes to the
gentlewoman from Washington (Ms. Dunn), a member of the Committee on
Ways and Means.
Ms. DUNN. Mr. Speaker, I am very happy that we have this bill on the
floor finally. I think it serves a real need, and it provides total
flexibility to people who want to provide for the coverage of their
health care expenses.
One particular provision that appeals to me is one that we used to
refer to as a catch-up health savings account contribution. We now call
it a health savings security account, and these are accounts that are
designed particularly for people who are age 55 or older. It gives them
the right to contribute additional dollars every year into their health
savings accounts because of particular situations they might have faced
in the past.
The flexibility of HSAs is widely known. These dollars can be used
for any health-related expense as long as it is not reimbursed. For
example, they can be used to pay for long-term care or for health
coverage policy or doctors' bills or for prescription drugs; but what
is special about the health savings security accounts is in the way it
applies to people like me. Many people, particularly women, during
their child-raising years took time away from the workplace and often
did not add money into accounts like IRAs, or actually Social Security
accounts, and ended up with big goose eggs when the time came to
calculate their benefits.
In this case, the health savings accounts provide for folks who took
time off during their child-raising years, or to look after an ill
parent; and it allows them to add up to 25 percent in additional
dollars each year to their health savings accounts. This will begin in
operation as soon as this bill is enacted. An individual age 55 or
older can contribute $500 a year in addition to the total health
savings account. That amount will grow to $1,000 in 2009, and I think
it is a very sensitively written provision to help folks who have been
away from the workforce or need this additional provision.
Mr. STARK. Mr. Speaker, I yield 3 minutes to the gentleman from
Michigan (Mr. Levin), a member of the Committee on Ways and Means who
understands that with this $174 billion that we are wasting in this
bill, we could help States maintain Medicaid coverage as they weather
their fiscal crisis.
Mr. LEVIN. Mr. Speaker, this came out of the wee hours of this
morning, but I want Members to realize how radical a move this is. We
are going to have later today a radical effort to dismantle Medicare.
What this is is a radical effort to dismantle our employer-based system
in this country. So now we are going to take a step toward a kind of
voucher for health insurance in the form of a tax credit. That is what
we are going to do.
Those who can afford to use the tax credit will have that voucher,
and they will go out into the marketplace. The consumer, each
individual one, is going to try to swim as best as they can. But for
those who do not have the money to put in this account, who have no
benefit from the tax credit, they are going to continue not to swim as
an individual consumer, but to sink. That is what is going to happen.
That is why this is so radical.
Now, the other side of the aisle said we want to add money into
Medicare in the prescription drug proposal. They are darn right. We did
not create this deep deficit. Their answer to a deficit that is deep is
to dig it deeper. In the middle of the night or early morning, you add
$100 billion to the deficit; and I want to quickly read what this looks
like.
We were supposed to have with the March baseline a deficit of $377
billion. We added $484 billion through what was called a technical
reestimate. Then through legislation, we added what was it, 700 to $800
billion. Now the projected deficit, $1.5 trillion, four times what was
projected a few months ago, and this does not include the bill that is
going to be brought up later or additional military expenditures. It
does not include this $100 billion. I tell the gentleman from Wisconsin
(Mr. Ryan), this is fiscally irresponsible. You Republicans have zero
fiscal responsibility in your political veins. Zero. This is radical
because it is going to dismantle the employer-based system.

Parliamentary Inquiry

Mr. HAYWORTH. Parliamentary inquiry, Mr. Speaker.
The SPEAKER pro tempore (Mr. Sweeney). Does the gentleman from
Michigan (Mr. Levin) yield for a parliamentary inquiry?
Mr. LEVIN. No, Mr. Speaker, I will not yield for a parliamentary
inquiry.
Mr. Speaker, as I was saying, you are not only going to dismantle
Medicare later as a first step, and now

[[Page H6000]]

try to dismantle the employer-based health care system in this country;
but what you are doing is digging a deeper, deeper hole of debt in this
country. This is a radical proposal on all accounts, and it should be
rejected.

Parliamentary Inquiry

Mr. HAYWORTH. Mr. Speaker, parliamentary inquiry.
The SPEAKER pro tempore. The gentleman will state it.
Mr. HAYWORTH. Mr. Speaker, is it appropriate for a Member to address
his comments directly to another Member, or should those comments be
directed through the Chair addressing the Member?
The SPEAKER pro tempore. All remarks should be directed through the
Chair.
Mr. HAYWORTH. Was it true that the preceding gentleman addressed a
Member directly?
The SPEAKER pro tempore. All remarks in debate should be directed to
the Chair.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield myself 30 seconds.
Mr. Speaker, to respond to a couple of comments from the last
speaker, I would say, number one, we are going to keep hearing this
rhetoric, that this undermines or destroys employer-sponsored health
care. Actually, it is far from that. It is the opposite of that. This
makes it easier for employers to offer health care to their employees.
What this does is it makes it easier because employers can offer less-
costly catastrophic coverage and give their employees money, pretax
money in their accounts, to purchase health care. This will lower the
cost of health insurance and make it cheaper for employers to offer
health care.
Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from Arizona
(Mr. Hayworth), an esteemed member of the Committee on Ways and Means.
Mr. HAYWORTH. Mr. Speaker, again, as we come to the well this
evening, we see a very vast difference in our visions of health care
and visions of America.
Our friends on the left who later tonight will offer a $1 trillion
government command-and-control approach to prescription drugs now take
strong objection, to put it diplomatically, about a plan that, yes,
initially is expensive. I would grant Members that billions are real
dollars here, but it substantially supplements and expands the ability
of people to have health insurance.
As the gentleman from Wisconsin (Mr. Ryan) mentioned, it gives
employers more options to provide that type of insurance by embracing
catastrophic plans and freeing up dollars to go to employees, and as we
see in the case of health savings security accounts, and this is the
key, and I would urge my colleagues to understand this, as so many have
come to the well of this House on both sides of the aisle and lamented
the numbers of uninsured Americans, not the medically indigent with
whom we try to deal through Medicaid, but those who are working people
who do not have insurance, this provides an option to those people to
embrace insurance. To realize savings, yes, does require a modicum of
personal responsibility, undoubtedly.
But, Mr. Speaker, certainly we have not degenerated to the point
where we absolutely forsake a notion of personal responsibility in
savings. What we do is offer options that will supplement health care;
and despite the cat calls and poisonous partisan rhetoric, it is worth
noting that this is bipartisan legislation.
So again a cautionary note to my friends on the left. If you believe
you are indicting one party, stop and think; many of your colleagues
who share both the party label and broad-based philosophy, as my
friends on the left share in many different areas, join with us in this
legislation because they understand it opens opportunity for health
insurance, it opens opportunity for individuals, it opens opportunity
for employers, and it will lead to more people seeking the insurance we
all want to see them have. Vote ``yes'' on this legislation.
Mr. STARK. Mr. Speaker, I yield 3 minutes to the gentleman from
Washington (Mr. McDermott) who realizes that with this $176 billion we
could insure every one of the 9 million uninsured children in this
country.
(Mr. McDERMOT asked and was given permission to revise and extend his
remarks.)
Mr. McDERMOTT. Mr. Speaker, I think it is important to realize that
last night a miracle occurred in this body, a bill that left the
committee costing $73 billion sometime after midnight suddenly became
$173 billion. An actual miracle in the Committee on Rules.
The fact is Members have to understand why that happened. All Members
make $150,000 a year. They were not covered by this bill. It only went
up to $65,000; but in the Committee on Rules they said, let us put
ourselves in this bill, so they raised it up to $150,000 so that we
could take benefit of this. Now that was a thoughtful thing for them to
be doing, but did they think about the people in your district?
My employees at Boeing, they get $65,000 a year. It is a pretty good
paying job, and they get good benefits from their company. What is to
stop their company tomorrow from saying, We are going to give you a
$10,000 deductible policy, and we will put $500 into your account, you
put $3,500 in, and you will have it all for yourself? They can do that.
They can end a defined benefit package at Boeing tomorrow and give a
defined contribution. Give employees a voucher, and say they are on
their own. Do Members want them to strike over that?
Mr. Speaker, how about the woman making $30,000 teaching school. We
all know those school teachers are rich people. You end the school
program, the State governments are in trouble, they could say let us
stop giving insurance to the teachers, let us just give them a $10,000
deductible policy, put $500 in their savings account and say to the
$30,000-a-year teacher, they can come up with $3,500 to put into their
account.

{time} 1745

I love to hear people who make $150,000 talk about what it is like to
be in this country making $30,000, which is the average pay. Or the
people making $18,000. They work every day. They have no insurance. Do
you think they have $3,500 to put into a savings account?
This is for rich people. That is why it went up $100 billion
miraculously between a $65,000 income limit and $150,000. It only cost
74 for all the people at the bottom, but it cost 100 for us. This is a
bad bill.
What it does, also, it says people are going to get out of the pool.
People who are rich and healthy are going to get out of the pool, and
they are going to leave the sick and the poor in the pool. And what
happens to the premiums for the average person? They go up. The idea of
insurance is to spread the risk, and you are letting the wealthy and
healthy get out of the pool.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield myself 15 seconds to
respond just briefly only to say that health care is voluntary by
businesses. Mr. Speaker, Boeing could drop their health care right now,
today, to their employees. And, Mr. Speaker, that is what is happening
today. Millions of businesses are making those kinds of decisions to
drop health care. We are trying to make it more affordable. We are
trying to keep it so that businesses can still offer health insurance
at an affordable price to their employees.
Mr. Speaker, I yield 2 minutes to the gentleman from California (Mr.
Royce).
Mr. ROYCE. Mr. Speaker, I thank the gentleman for yielding me this
time. This measure will make it easier for employers to offer health
care to their employees. It is also going to help Americans save for
their medical expenses, to gain greater access to quality health care.
I particularly support the provision in this bill that would prevent a
portion of the unused balances and flexible spending arrangements from
being forfeited at the end of the year. Right now there is a use-it-or-
lose-it provision that applies to workers. I have been working for
several years to allow individuals to accumulate unused balances from
their flexible spending arrangements to save for health care expenses.
In this Congress I introduced H.R. 176 to allow individuals to
accumulate $2,000 annually from these FSAs, as we call them.
Right now we have over 30 million workers in the United States that
have these FSAs available to them. Employees and employers can set
aside pretax

[[Page H6001]]

money which can be used to pay for out-of-pocket health care expenses
and copayments and deductibles. Under the current system,
unfortunately, employees forfeit money not used at the end of the year.
Currently, this encourages wasteful health care spending because
employees, knowing that they will forfeit unused account balances,
engage in end-of-the-year spending sprees on services they may not need
like extra eyeglasses, shades or unnecessary exams. So eliminating the
use-it-or-lose-it provision solves this problem because then the
employee will be able to roll over the balance from year to year. That
is the attempt in this bill on that provision.
Preventing some forfeiture also increases the savings rate by
increasing the disposable income of those employees in the program, and
it also empowers them to make their own health care decisions. I urge
my colleagues to pass this legislation.
Mr. STARK. Mr. Speaker, I yield myself 30 seconds. I have a couple of
letters, one from the AFL-CIO which suggests that this legislation
would establish an enormous tax shelter for wealthy individuals and at
the same time undermine employer-based health coverage and shift costs
onto workers. I have a letter from Families USA which, among other
things, says that this bill also threatens the employer-provided health
insurance system particularly among smaller employers who will be able
to take deductions in the top brackets and who will then no longer be
interested in providing coverage for their employees.
Mr. Speaker, I include both letters for the Record.

American Federation of Labor and Congress of Industrial
Organizations,
Washington, DC, June 26, 2003.
Dear Representative: The AFL-CIO opposes H.R. 2351, the
Health Savings Account Availability Act. This legislation
would establish an enormous tax shelter for wealthy
individuals and at the same time undermine employer-based
health coverage and shift more cost onto workers. Despite
proponents' claims, this bill would fail to expand coverage
to the uninsured and would be especially harmful to those
low-income, older and sicker workers who now have
comprehensive coverage.
Under H.R. 2351, employers could offer Health Savings
Accounts as long as they are provided in conjunction with
high-deductible health insurance policies, defined as at
least $500 for an individual policy and $1,000 for a family
plan. This will encourage employers to abandon more generous
coverage and offer instead less comprehensive policies that
shift significant costs onto workers. The Joint Committee on
Taxation has estimated that 30 million such accounts would be
established by 2013 and the majority of employers would
modify their health plans to meet the high-deductible
guidelines of the legislation.
In addition, this shift in coverage would harm most those
workers who need health care. Low-income workers who are the
intended beneficiaries of these plans' preferred tax
treatment are not likely to get back enough in taxes to
offset the greater out-of-pocket costs they are likely to
incur with these high-deductible plans.
Furthermore, those workers and other insured individuals
who have traditional, more comprehensive coverage will see
their premiums rise. Younger, healthier workers will likely
choose the less-comprehensive coverage, leaving older and
sicker workers and those who earn too little to pay taxes in
traditional coverage. As a result, costs for this coverage
will rise, leaving workers with no choice but to enroll in
the high-deductible coverage this bill seeks to promote.
This legislation was slipped through the Ways and Means
committee last week, and made worst late last night in the
Rules Committee. Among the changes made in Rules, the income
threshold has been raised to $175,000 for joint filers. The
cost of the revised bill is estimated to be $174 over ten
years--more than twice the estimated cost of the bill that
passed Ways and Means last week--and makes clear that this
legislation is first and foremost another tax shelter, not a
bill to cover the uninsured.
H.R. 2351 was raised just last week with little notice and
certainly without any hearings, despite the bill's far-
reaching implications and significant cost. And now the House
leadership has called for it to be joined with the Medicare
prescription drug legislation before the House. I urge you to
vote against H.R. 2351.
Sincerely,
William Samuel,
Director, Department of Legislation.
____

Families USA

Washington, DC, June 26, 2003.
Hon. Charles Rangel,
Rayburn House Office Building,
Washington, DC.
Dear Representative Rangel, On behalf of Families USA, the
national advocacy group for health care consumers, I am
writing to oppose the Health Savings and Affordability act of
2003 (H.R. 2596). Implementation of the Health Savings
Accounts (HSAs) and Health Savings Security Accounts (HSSAs)
will do little to expand health insurance coverage to the 41
million Americans who are uninsured.
This bill creates two programs loosely modeled after
existing Archer Medical Savings Accounts (MSAs). Rather than
targeting limited federal funds to provide help for the
lowest-income uninsured, this bill creates tax-free accounts,
the HSSA's, which can be accessed by families with incomes up
to $150,000 before starting to phase-out. The total cost of
this bill is over $169 billion over ten years--a huge federal
investment that will do little or nothing to cover the low-
income uninsured. The people who deserved to be helped in any
health legislation are being ignored by this legislation. If
this huge commitment of resources were applied to an
expansion of the Children's Health Insurance Program or to
Medicaid, we could cover every uninsured child in America
(about 8.5 million) with excellent care and have money left
over to help their mothers! To casually, and with so little
debate, spend these huge resources on so many higher-income
individuals is a travesty of the legislative process.
This bill also threatens the employer-provided health
insurance system, particularly among smaller employers who
will be able to take deductions in the top brackets for their
personal insurance and who will then no longer be interested
in providing coverage for their employees.
We look forward to working under your leadership to reject
this bill, and instead to work for real and meaningful
mechanisms to expand coverage to the uninsured in this
country. Thank you for your continued commitment to this
issue and to reducing the number of uninsured Americans.
Sincerely,
Ronald E. Pollack,
Executive Director.

Mr. STARK. Mr. Speaker, I yield 3 minutes to the distinguished
gentleman from Wisconsin (Mr. Kleczka).
Mr. KLECZKA. Mr. Speaker, let me thank the gentleman from California
for yielding me this time.
Mr. Speaker, I really do not know where to start, to start answering
some of the critics and the proponents of this legislation. This bill
started out about a week ago or so in the Committee on Ways and Means,
which I serve on, and the cost was $14 billion. Then the day the bill
came up, the cost rose to $72 billion. And then last night the cost
went to $173 billion. Mr. Speaker, let us pass this bill quickly,
because I am afraid it is going to continue to grow. But that does not
make it a good bill.
What is going on here, my friends, is this is the demise of the
employer-sponsored health care system in this country. The employers do
not like it. They want to get out of it. Members of the committee,
including the chairman, have indicated that their desire is to
dismantle the employer-based health care system. This bill does it.
How does it do it? It gives the employer an option. It says, Mr. and
Mrs. Employee, we are changing your health policy. I am going to give
you one starting next month that will provide for a $2,000 deduction on
your health care costs. Start saving, because the Congress passed a
bill where you can save and then you pay the first $2,000.
It sounds fine in principle, but here is the problem, my friends.
Working families in this country have to first of all pay the mortgage
so they do not lose the home, pay for the car so he can get to work,
feed the kids and clothe them and send them to school, and then this
Congress has already told you that the past generation has been
irresponsible, they did not plan for their future and you better. So
put money away for your retirement in an IRA and a 401(k). And you say,
yes, because Social Security probably will not be enough, I will do
that. Then this Congress said, college education is going up, mom and
dad, start saving for your kids' education. And so you say, yeah, I
will put a couple of thousand away a year for Johnny's and Sally's
education.
Now we are saying to you, after all this, we have got another one,
start saving for your health care. Then you say, Mr. Republican
Congressman, I am out of money. I do not make that much. I do not have
any more disposable income. And so when your employer changes your
health plan and you do not put the $2,000 or $4,000 away when you get
sick, you are out of luck. That is what is going on here. Make no
mistake about it.
Mr. STARK. Mr. Speaker, I yield 4 minutes to the distinguished
gentleman from Texas (Mr. Doggett), a

[[Page H6002]]

member of the Committee on Ways and Means.
Mr. DOGGETT. Mr. Speaker, once again Republicans insist on a fiscally
irresponsible bill that will benefit the wealthiest and in this case
the healthiest at the cost of at least $174 billion added to our
already soaring national debt.
Mr. Speaker, despite the bright sunshine outside, it really is a dark
day for so many Americans who are working hard just to make ends meet.
This bill is the natural companion to a measure written by the same
folks that are presenting this bill, which previously denied a child
tax credit to poor working folks. Tax cuts, no matter what the economic
conditions, no matter how pressing are the other priorities we have in
our country, such as protecting our families from terrorism, tax cuts,
we are always told, can cure any ill in our society, unless of course
you are poor and working, in which case your kids are not worthy of a
child tax credit.
Thanks to the intransigence of the House Republican leadership, there
are now 6 million working American families, they are folks like
cafeteria workers and teachers' aides, nursing home employees, those
working at our hospitals doing the tough work, they will receive no
check for their children this year like other Americans. Their bid to
gain a little economic independence, to share in the economic benefits
of the American Dream, it will come and go on July 4 unfulfilled
because of the refusal of this House Republican leadership and their
desire to go on recess not only for July 4 but to continue their recess
from reality.
For these same families that were deliberately excluded from the
recent tax cut as well as for many other working families, House
Republicans add more insult to injury by encouraging employers to
terminate or to weaken any group health insurance coverage through
which some of these employees may be covered. This bill is also the
natural companion to the next bill that we are about to take up, the
bill to repeal Medicare as we have known it, since President Lyndon B.
Johnson signed it into law. We know this is not new. They have opposed
Medicare since before President Johnson wrote his signature to make it
a reality. Newt Gingrich wanted it to wither on the vine. Earlier this
month, Mr. Gingrich declared, much as our colleagues are here today,
using the very same words that they got from Newt Gingrich, that it was
an ``obsolete government monopoly.''
Only yesterday we heard the same language from the sponsor of this
measure: ``To those who say that the bill would end Medicare as we know
it, our answer is, `We certainly hope so.' ''
``Old-fashioned Medicare isn't very good,'' said Bill Thomas, the
sponsor of this legislation and the companion measure to repeal
Medicare tonight.
Some of us think old-fashioned Medicare has worked pretty well for
the millions of Americans that it has served since 1965, and we want to
strengthen it, not see it undermined through into privatization.
The bill before us this afternoon does something very similar to what
the later bill proposes to do to Medicare and, that is, to weaken, at
great cost to our Treasury, our employer-based health care system. By
totally excluding employees unless they are in plans that deny any
assistance on at least the first $1,000 or $2,000 in medical bill
coverage, this bill will encourage even higher deductibles. And it will
be a struggle for a cafeteria worker to pay their first $1,000 or their
first $2,000 or more-thousand under these new high-deductible plans.
The same plans will encourage more small employers to stop providing
coverage at all and to protect themselves individually through these
MSAs and to terminate costly health insurance for their other
employees. It will encourage group health plans to reduce covered
services, increase copayments.
In short, through these three bills, we see Republican indifference
from cradle to grave for children, for workers, for seniors.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield 3 minutes to the
gentleman from Pennsylvania (Mr. English) to talk about this
legislation that we are debating, health savings accounts.
Mr. ENGLISH. Mr. Speaker, I really wish more of the American public
were watching this debate because they would be able to fully
appreciate how marginal the left has become to any serious debate about
the problems facing this country. What we are going to be doing tonight
is not voting to repeal Medicare, but instead voting to pass this bill,
which is a bill that would provide more medical security for uninsured
Americans as well as many low- and middle-income workers.
This legislation actually creates two new instruments to meet health
care needs by rewarding Americans who open either type of account with
tax advantages and maximum flexibility, so as the other side has noted,
even the healthy can have a greater role in managing their own health
care. Encouraging individuals to enroll in these new savings vehicles
has multiple benefits. First, this is a big step to make health
insurance more affordable and help reduce the growing number of
Americans without health insurance. The tax-preferred nature of the
health savings security accounts offers a powerful incentive for
uninsured workers to take advantage of these accounts. The
contributions to the accounts are deductible; the investment earnings
within the accounts tax-free; and the distributions are also tax-free
when used for health insurance. Many, including the self-employed,
would find this enormously valuable. This results in significant
savings on health insurance, an economic benefit that is certain to
encourage many uninsured Americans to utilize these accounts.
Second, insured workers with high-deductible plans will also see
similar incentives. Both savings vehicles give individuals a potent
incentive to save for health care costs that do not fit within their
deductible, giving them another option and perhaps some peace of mind
about unanticipated medical expenses. The medical expenses that qualify
for tax-free distributions are very far reaching and include expenses
from preventive care to long-term care. When individuals use their own
hard-earned dollars for health care, they will ask more questions,
further inform themselves, and become better consumers of health care
products. This bill undoubtedly promotes an educated and wise consumer
of health care services and will result in all-around better health
care decisions.
Our current Tax Code puts a punitive burden on working families who
save their own money for medical and other expenses. The health savings
accounts ease that burden by providing two simple and flexible savings
mechanisms for working families.

{time} 1800

This is commonsense legislation that makes health insurance and
health care more affordable and tax advantaged for Americans. It does
not destroy our health care system and it does not dismantle Medicare.
Accordingly, I urge my colleagues to give workers control of their own
health care and vote for the creation of health savings accounts.
The SPEAKER pro tempore (Mr. Sweeney). The Chair advises Members that
the gentleman from California (Mr. Stark) has 9 minutes remaining and
the gentleman from Wisconsin (Mr. Ryan) has 12\1/4\ minutes remaining.
Mr. STARK. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from New Jersey (Mr. Pallone), who understands that we could
cover the parents of low-income children who are eligible for Medicaid
and CHIP with the same amount of money.
Mr. PALLONE. Mr. Speaker, I just do not know how many tricks or
hoaxes the Republican leadership is going to play on us tonight and on
the American people. It is unbelievable. I listened to the gentleman
from Pennsylvania. He said there is going to be Medicare reform
tonight. There is not going to be Medicare reform. It is just going to
be an effort to kill Medicare and destroy Medicare. And then they say
they are going to bring up a prescription drug benefit tonight that
really is not any meaningful benefit that forces one into HMOs, that
denies them of choices of doctors and hospitals. And now this one, the
ultimate trick, which I guess we did not really even know about until
today, that basically tries to undercut employer-based health
insurance.
When does it end? When are the Republicans going to end what they are
trying to do to destroy the health care system?

[[Page H6003]]

Mr. Speaker, although we would like to provide health coverage for
those who are uninsured, this bill does little or nothing to help the
low-income uninsured. Individuals eligible for the tax credit under the
Thomas bill would have to be uninsured or in high deductible plans, but
according to the bill, starting in 2004, those individuals could set
aside up to $2,000 tax free into a new health savings account to
supposedly help pay for health insurance. But the argument that the
bill will assist the uninsured is simply not true. Most uninsured have
incomes that are too low to owe Federal income tax liability, let alone
have $2,000 to set aside for this purpose. In addition, self-employed
individuals, the other large segment of the uninsured, may already
deduct 100 percent of the health insurance costs.
The only consequence of this bill is to undercut the provision of
employer-sponsored health care coverage by encouraging employers to
raise deductibles or potentially drop their coverage and raise the cost
of health care for low income, older and sick workers with higher co-
payments and premiums.
And, lastly, as many of the speakers on our side have said, this
legislation will cost the government over $173 billion, another in a
series of fiscally irresponsible tax cuts passed by the House. The
entire cost of the bill will be funded by borrowing, increasing the
national debt.
Where does this end? We have a national debt 4-, $500 billion. Where
is it going to end?
Mr. RYAN of Wisconsin. Mr. Speaker, I yield 2 minutes to the
gentleman from Nebraska (Mr. Terry).
(Mr. TERRY asked and was given permission to revise and extend his
remarks.)
Mr. TERRY. Mr. Speaker, when will it end? I am saddened by the
arguments from the left that fail to recognize that there are more
people in America that want to have choices. They do not want just the
offering of a government program one size fits all. Not everyone thinks
that the government is the answer to everything. So I am proud to
support bills that allow the market to provide opportunities and
choices, and that is what tonight is about. I am wondering sitting here
listening to the debate what some of our Founding Fathers would think
of today's debate. Think about the people that started this country
that left their countries to set sail on a venture unknown to come to a
new land for what? Freedom. Trying to escape the government powers that
were controlling their lives. And now 200 or 300 years later from those
first people that landed on our shores, our debate is how far
government is going to control their health and their lives. Not
everybody wants bureaucrats running their health care. So I am proud to
stand in favor of the HSAs.
Mr. Speaker, in today's world us baby boomers, and, yes, I am on the
tail-end, there are a few others that are nearing their entry into
Medicare, but we are facing a crisis too. Our parents need help in
today's world. At the same time that we worry about our parents' health
and their futures and what our role is as their children will be in
helping them in their golden years, we are also raising our children,
trying to save for their college and their future. This is one pro-
family tax item. It allows me, as the child of a father who had a
stroke last October, to help my parents with their health care costs.
So this is one great pro-family tax measure, and I urge my colleagues
to support it.
Mr. STARK. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
Illinois (Mr. Emanuel).
Mr. EMANUEL. Mr. Speaker, I thank my colleague from California for
yielding me this time.
Earlier the speaker before me talked about choice. In the
prescription drug debate we are having, I have talked about choice and
I have an amendment, a bipartisan amendment, to offer people choice
between generic versus name brand drugs that would reduce prices so
people could pick cheaper drugs. Also part of the provision allows
individuals, government, private sector, to buy medications anywhere in
the G-8 countries and have competition so they can get drugs cheaper in
Germany or France or Canada or Italy. That would drive prices down.
I too agree with competition. The free market would drive prices
down. So those of us who embrace the free market wonder why sometimes
our colleagues on the other side are so scared of the free market. I
have seen that the benefits of the free market work. I would like to
see it come to the discussion we have on a prescription drug bill
because if we bring that competition of the free market to the debate
about prescription drugs, we will make medications more affordable to
all Americans of all ages.
The interesting thing is there are two issues that are driving health
care inflation at 25, 30 percent for the public. One is the cost of
prescription drugs. Two is the 42 million uninsured who show up in our
emergency rooms, driving up hospital costs which insurance companies
pass on to employers and employers pass on to employees. And if we
wanted to insure the uninsured, we can do it for a lot less money than
this. Expand Kid Care. In Illinois we have a program known as Kid Care,
insurance for the children of working parents, that expands the kid
care to family care.
What is most interesting about this debate is that we have a
prescription drug bill coverage for Members of Congress that is far
more generous than the one that we are about to provide for our
elderly. Those are the wrong values. Those are not the values that we
came here to represent.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield 30 seconds to the
gentleman from Louisiana (Mr. McCrery), from the committee.
Mr. McCRERY. Mr. Speaker, the immediate preceding speaker, the
gentleman from Illinois (Mr. Emanuel), spoke about the free market and
letting free market forces work with respect to prescription drugs, and
his solution is either import drugs from other countries and sell them
here of course at lower prices or let us adopt the prices that are paid
in those other countries here in our country, and he calls that the
free market.
What he failed to point out is those drugs and those prices that he
would be importing or adopting the prices out here are set by
government price controls, not the free market.
Mr. EMANUEL. Mr. Speaker, will the gentleman yield?
Mr. McCRERY. I yield to the gentleman from Illinois.
Mr. EMANUEL. Mr. Speaker, the fact is we would have competition. It
is a Gutknecht-Emanuel bill with a number of the gentleman's colleagues
on his side and a number of colleagues on my side. The three provisions
to this bill, A, allow generics to come to market quicker so name brand
pharmaceutical companies could not be involved in frivolous lawsuits.
Mr. McCRERY. Mr. Speaker, reclaiming my time, the issue of generics
is addressed in the underlying bill that we will be debating later
tonight, but the gentleman spoke about bringing drugs in from other
countries and selling them at prices that have been imposed by
governments, not by the free market.
Mr. STARK. Mr. Speaker, I reserve the balance of my time.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield 2 minutes to the
gentleman from Texas (Mr. Burgess).
Mr. BURGESS. Mr. Speaker, I thank the gentleman from Wisconsin for
yielding me this time.
H.R. 2596 will increase access to consumer-based health coverage to
all Americans regardless of income. Under H.R. 2596 the availability of
health savings accounts will assist those that live without health
coverage and give Americans more options when it comes to their health.
Health savings accounts will promote savings and more direct health
purchasing.
The character of these accounts will also simplify the doctor-patient
relationship. As a physician, I know firsthand the difficulty some
patients have working through their insurance companies and trying to
figure out what services are covered by their policies. With a health
savings account, patients can focus their attention on their medical
care. They can discuss their needs with their doctors frankly and
honestly, and they can proceed with appropriate medical treatments that
they need.
My colleagues on the other side of the aisle are more prepared to
force people into a one-size-fits-all solution instead of giving
individuals the choice

[[Page H6004]]

or the purchasing power to make decisions for themselves.
I myself have had a medical saving account since 1997, that is, until
I came to Congress, and it was coverage that I made available to
everyone in my practice as a choice. It was not a requirement. If
someone wanted the chance to be in charge of their medical decisions
and a chance to build wealth in one of these accounts for future
medical expenses, I thought it was only prudent as an employer to
provide that opportunity.
Mr. Speaker, we talk about the evils of HMOs, and the Members on the
other side of the aisle are frequently mentioning the evils of HMOs,
but this is the anti-HMO. Put the purchasing power back in the hand of
the patient.
These plans are centered on the concept of personal choice. These
accounts make more money available to purchase health coverage. We need
to be serious about the solutions when addressing the problems of the
uninsured in this country. An individual will make rational decisions
when they have the ability to spend their own money on their health
services.
I ask my colleagues, I implore my colleagues, not to stand in the
way. Give Americans the freedom to make this decision.
Mr. STARK. Mr. Speaker, I yield 2 minutes to the gentleman from
Washington (Mr. Inslee).
(Mr. INSLEE asked and was given permission to revise and extend his
remarks.)
Mr. INSLEE. Mr. Speaker, in regard to the Medicare bill we will be
considering this evening, I thought about coming down to the House and
asserting that this bill was a Trojan horse, but I think it is worse
than a Trojan horse. I do not think it would be fair to the Trojan
horse metaphor to call this a Trojan horse. And the reason is, is when
the Athenians sent the horse to the Trojans, they did not announce in
advance that the horse was full of soldiers that were going to attack
the city. They kind of kept that a secret. But the Republicans have not
kept any secrets about this horse at all because if we look at what the
gentleman from California (Mr. Thomas) said, ``To those who say that
the Medicare bill would end Medicare as we know it, our answer is we
certainly hope so.''
If the Athenians had announced that the gift, the alleged gift, they
were sending was going to destroy the city they were attacking, no one
would have bought that old nag. And it the same situation here. We
should not buy this old nag of a bill with the expressed intent of
destroying Medicare over the next 10 years. And, yes, it is complicated
on how that is going to happen. And, yes, it is a little bit chaotic in
explaining it. But the Members can rest assured that America's senior
citizens are going to figure this out. They are going to figure out
this is worse than a Trojan horse because they see it coming. We should
reject this and adopt the Democratic substitute.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield 2 minutes to the
gentlewoman from Florida (Ms. Harris).
(Ms. HARRIS asked and was given permission to revise and extend her
remarks.)
Ms. HARRIS. Mr. Speaker, today the House of Representative stands at
the threshold of passing landmark legislation that protects and
improves Medicare while providing our seniors with a real prescription
drug benefit. While the debate remains properly focused upon this moral
obligation to our seniors, I wish to highlight another exciting
component of health care reform that we will address today.
H.R. 2596, the Health Savings and Affordability Act of 2003,
authorizes the creation of health savings accounts which will enable
every American to pay their basic medical expenses from tax-free money.
In almost every purchase of goods and services except health care,
individuals bargain directly with vendors and providers.

{time} 1815

Assuming an adequately competitive market, suppliers will not charge
more than buyers are willing and able to pay for very long.
The structure of our current health care system pushes consumers to
the sidelines. Big insurance companies negotiate prices with big health
care conglomerates, producing a distorted market and more expensive
health care, prescription drugs, and health insurance premiums for the
uninsured and self-employed.
H.R. 2596 allows Americans, particularly Medicare-eligible seniors,
to use health care savings accounts to pay for medical expenses,
prescription drug costs, retiree health insurance expenses, long-term
care service, and COBRA coverage. It permits family members and
employers to make tax-free contributions to these accounts.
The nature and uncertainty of health care expenses will always
require critical programs such as Medicare and an efficiently-operating
insurance industry. That is why the reforms that we will adopt in H.R.
1 are so vital.
Nevertheless, through the magic of the free market, H.R. 2596 will
reduce costs that many Americans pay for the most basic health care
needs, while forcing our entire health care system to become more
efficient.
Mr. STARK. Mr. Speaker, I am delighted to yield the balance of our
time to the distinguished gentleman from California (Mr. George
Miller), the ranking member of the Committee on Education and the
Workforce.
Mr. GEORGE MILLER of California. Mr. Speaker, I thank the gentleman
for yielding me this time.
Mr. Speaker, in the next few hours, the Republicans in the Congress
will engage in the greatest raid and diminishment on middle-class
health care benefits in the history of this country. Benefits that have
been built up over the last 50 or 60 years in this country that have
enabled middle-class individuals to have some health security, to have
some access to prescription drugs, to have access to the health care
that they and their families need, will come under assault. It begins
with this legislation, medical savings accounts, where millions of
Americans who now have good health care plans, where they share the
payment of those plans with their employers, between employers and
employees, will find out that those plans are going to be substituted
by high-threshold, high-cost, high-deductible plans, and the theory is
that they can pay for that out of their medical savings accounts.
Millions of Americans are going to wake up and find out that the
health care plans that they have available to them today will not be
available to them tomorrow.
Just as with the passage of the Medicare bill, the prescription drug
bill that we will do later tonight, some 30 percent of the people who
have prescription drug benefits will wake up and find out that they
will get a lesser benefit under the Medicare prescription drug benefit
than they are currently getting today. Millions of senior citizens will
discover that they have lost their prescription drug benefit as they
know it, and they will have to accept something much less than that.
When we come back from the Fourth of July break, we will complete
this trifecta assault on middle-class health care plans when the
Committee on Education and the Workforce reports out the Association
Health Care Plan proposal. Because the CBO, the Congressional Budget
Office tells us that over 8 million Americans will lose the health care
they have today, and what will be substituted will be a health care
plan that is much less comprehensive than they have today. Mr. Speaker,
8 million Americans, 8 million middle-class Americans. And the answer
that the Republicans suggest to us is we can all just save and pay for
that ourselves.
Well, if we look who is paying into 401(k)s, we know that most
Americans do not have that disposable income. That is why they have
employer-based health care systems.
But starting tonight, that employer-based health care system, that
system that has done so much to keep people healthy, to keep people out
of poverty, to keep them from losing their homes, is about to be
shredded; and the assault is complete and its comprehensive, and it
runs from the seniors to new and young families trying to raise
children. All of these people will find out. If my colleagues do not
think it is going to happen, just look at the employers who are
announcing that these cutbacks are going to come who are supporting the
association health care plans, who are supporting medical savings
accounts, these health savings accounts tonight, and who are supporting
prescription drugs. Because they are lining up to get rid of their
obligations for prescription drugs, for health care for young

[[Page H6005]]

families, health care for older families, all in the name of their cost
savings. But that will dramatically change the middle class in this
country and what they have come to know as health care security.
But for the elderly it is going to be even more dramatic. When we
look at the prescription drug benefit, it is interesting that the
largest elderly group in the country, AARP, everything that they say is
essential to protect senior citizens, and a prescription drug benefit
is not in this bill. Read their letter. It is not in this bill. They
wish it was, they hope it will be, but it is not here tonight.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield myself the remaining
time.
I would like to begin my closing by saying that the gentleman from
California is a person who has worked in health care for many, many
years; and I know that he is sincere in trying to do what he thinks is
best to give access to people who need health care. I believe everyone
who came to the floor and into the well who spoke on this bill today
cares about health care.
Mr. Speaker, I am relatively new to this body; but one thing I have
learned is that if you are running out of arguments, the oldest trick
in the book is to impugn the other person's motives. Tell them that all
we want to do is help the rich and hurt the poor, that what we are
trying to do is destroy employer-sponsored health care.
Well, Mr. Speaker, two of the Nation's leading organizations who
represent small employers, the people who are really facing these high
premium hikes, the National Association of Manufacturers, the National
Federation of Independent Businesses, this is one of their key
priorities. They endorse this bill.
What this does, Mr. Speaker, is it makes it easier for employers to
offer health care to their employees. It helps us continue employer-
sponsored health care.
Another thing that we have been hearing, that this is fiscally
irresponsible and adds to the deficit.
Mr. Speaker, what is fiscally irresponsible is the substitute
prescription drug bill that the minority is bringing to the floor which
costs $600 billion more than the budget resolution allows. The budget
resolution that passed this House balances the budget within the term
of the budget resolution, within 10 years. And this is paid for and
budgeted for in the budget resolution.
Mr. Speaker, at the end of the day, after we have heard all of these
arguments, it kind of comes down to two things, two different
philosophies: socialism versus consumerism. They want socialized
medicine. They want power to go to Washington where Washington can
allocate the benefits, where Washington can ration the health care. We
want power to go to the people. We want power to go to the consumers.
We want people to have more choices. They want to restrict those
choices.
This does not take anything away from anybody, Mr. Speaker. This
gives people more choices. This says to people, if you are having a
hard time saving for your health care, we are going to make it easier
for you to do that. If you are a small business and you cannot afford
health care for your employees right now, we are giving you a new
option to do just that.
We are going to give employers the ability to say, look, you can put
money in an account that you can deduct it from in your employee's
name. Your employees contribute to this account. If you do it, you have
to buy catastrophic health care coverage for them. So we are making
sure with health care savings accounts that there is health insurance.
And the beautiful part of this proposal, Mr. Speaker, is that this is
the employee's money; it is their money that is at stake when they go
out and buy health care. They are going to act like real consumers.
They can take this money with them when they leave their job and go to
another job. They can take this money with them into retirement
throughout the rest of their life; and when they die, this money can go
to their spouse. This money becomes the individual's money.
One of the big problems we have in health care today is we do not act
like consumers. We have third-party payers paying the bills, and so
when we go and pay for health care, someone else is paying the bills,
so we really do not care how much it costs. That is one of the reasons
why the costs of health care are going up through the roof.
This puts in place 280 million brains on behalf of bringing down
health care costs and 280 million sets of eye balls watching this
industry to make sure that doctors are charging the right kinds of
prices, that hospitals are not overcharging, and that they are getting
the best quality for their dollar.
Mr. Speaker, it is about giving power to consumers versus giving
power to bureaucrats in Washington. Let us give Americans more freedom,
let us give consumers more power, and let us help bring down health
care costs.
Mr. Speaker, I urge passage of this bill.
Ms. JACKSON-LEE of Texas. Mr. Speaker, it used to be that the most
challenging part of my job here was finding meaningful ways of
improving quality of life for the people in my district. Now it seems
the most challenging part is trying to figure out how the Republican
leadership will next try to deny those same people the lives they and
their families deserve. Today's bill is one of the more creative
approaches I have seen by the Republicans to advance their goals of
giving their rich political donors big tax cuts, and denying the poor
and middle classes healthcare and the services they need.
This bill serves no one that really needs it, and will actually
undermine the health insurance benefits received by millions of
Americans now. It is confusing and complex, and makes a mess of a
system that needs to be fine-tuned, not destroyed. The majority of
Americans now receive health insurance through employers. This bill
will offer a tax break to people who do not have health insurance
coverage, and those whose coverage has a deductible of over $1,000. It
sounds good, until you think about it. This bill will serve to
encourage businesses to cut their health insurance programs, or raise
deductibles on their employees. Low- to moderate-income employees and
those who are uninsured pay all kinds of taxes: payroll taxes, sales
taxes, property taxes. However, they tend to not pay enough income
taxes to take advantage of this new Republican-give-to-the-rich scheme.
So the exact people who are not being left out of our healthcare
system, and who need relief, are being left out of this bill.
The underlying goal of this bill is to dismantle the employer-based
health insurance system that the Chairman of the Ways and Means
Committee hates. He has stated that he does not like employer-based
health insurance because it shields people from the cost of healthcare
and thus enables people to use healthcare too much. I don't see that
Americans have made themselves too healthy. I want to increase access
to care not decrease it, so I will vote against this bill.
Not only is this a bad bill, it is an expensive one. It will cost $71
billion over the next ten years--all money borrowed from our children
and grandchildren. In the later years of the budget window, this bill
will cost in excess of $10 billion per year, and will accelerate just
at the time when the baby boom generation retires, denying resources to
meet our commitments to the Social Security and Medicare systems.
Again, it seems this bill was crafted to specifically target and
destroy the elements of our healthcare system that people know and
trust: Medicare and Employer-sponsored coverage--and use the savings to
give to CEOs, the healthy, and the wealthy. It is not surprising to
find that due to the structure of this bill, the same people whose
children were denied the benefits of a child tax credit, will also not
receive any benefits from this bill.
Of course they will be allowed to help pay the interest on the
booming debt that it adds to.
I will oppose this bill and encourage my colleagues to do the same.
Mr. RYAN of Wisconsin. Mr. Speaker, I yield back the balance of my
time.
The SPEAKER pro tempore (Mr. Sweeney). All time for debate has
expired.
Pursuant to House Resolution 299, the bill is considered read for
amendment and the previous question is ordered.
The question is on the engrossment and third reading of the bill.
The bill was ordered to be engrossed and read a third time, and was
read the third time.
The SPEAKER pro tempore. The question is on the passage of the bill.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Mr. STARK. Mr. Speaker, I object to the vote on the ground that a
quorum is not present and make the point of order that a quorum is not
present.

[[Page H6006]]

The SPEAKER pro tempore. Evidently a quorum is not present.
The Sergeant at Arms will notify absent Members.
The vote was taken by electronic device, and there were--yeas 237,
nays 191, not voting 7, as follows:

[Roll No. 328]

YEAS--237

Aderholt
Akin
Alexander
Bachus
Baker
Ballenger
Barrett (SC)
Bartlett (MD)
Barton (TX)
Bass
Beauprez
Bereuter
Berkley
Biggert
Bilirakis
Bishop (GA)
Bishop (UT)
Blackburn
Blunt
Boehlert
Boehner
Bonilla
Bonner
Bono
Boozman
Boyd
Bradley (NH)
Brady (TX)
Brown (SC)
Burgess
Burns
Burr
Burton (IN)
Buyer
Calvert
Camp
Cannon
Cantor
Capito
Cardoza
Carter
Case
Chabot
Chocola
Coble
Cole
Collins
Cox
Crane
Crenshaw
Cubin
Culberson
Cunningham
Davis (TN)
Davis, Jo Ann
Davis, Tom
Deal (GA)
DeLay
DeMint
Deutsch
Diaz-Balart, L.
Diaz-Balart, M.
Dooley (CA)
Doolittle
Dreier
Duncan
Dunn
Ehlers
Emerson
English
Everett
Feeney
Ferguson
Flake
Fletcher
Foley
Forbes
Fossella
Franks (AZ)
Frelinghuysen
Gallegly
Garrett (NJ)
Gerlach
Gibbons
Gilchrest
Gillmor
Gingrey
Goode
Goodlatte
Goss
Granger
Graves
Green (WI)
Greenwood
Gutknecht
Hall
Harris
Hart
Hastert
Hastings (WA)
Hayes
Hayworth
Hefley
Hensarling
Herger
Hobson
Hoekstra
Hooley (OR)
Hostettler
Hulshof
Hunter
Hyde
Isakson
Issa
Istook
Janklow
Jenkins
Johnson (CT)
Johnson (IL)
Johnson, Sam
Jones (NC)
Keller
Kelly
Kennedy (MN)
King (IA)
King (NY)
Kingston
Kirk
Kline
Knollenberg
Kolbe
LaHood
Latham
LaTourette
Leach
Lewis (CA)
Lewis (KY)
Linder
Lipinski
LoBiondo
Lucas (KY)
Lucas (OK)
Manzullo
McCotter
McCrery
McHugh
McKeon
Mica
Miller (FL)
Miller (MI)
Miller, Gary
Moran (KS)
Murphy
Musgrave
Myrick
Nethercutt
Neugebauer
Ney
Northup
Norwood
Nunes
Nussle
Osborne
Ose
Otter
Oxley
Paul
Pearce
Pence
Peterson (MN)
Peterson (PA)
Petri
Pickering
Pitts
Platts
Pombo
Porter
Portman
Pryce (OH)
Putnam
Quinn
Radanovich
Ramstad
Regula
Rehberg
Renzi
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Royce
Ryan (WI)
Ryun (KS)
Saxton
Schrock
Scott (GA)
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simmons
Simpson
Smith (MI)
Smith (NJ)
Smith (TX)
Souder
Stearns
Sullivan
Sweeney
Tancredo
Tauzin
Taylor (NC)
Terry
Thomas
Thornberry
Tiahrt
Tiberi
Toomey
Turner (OH)
Upton
Walden (OR)
Walsh
Wamp
Weldon (FL)
Weldon (PA)
Weller
Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)

NAYS--191

Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldwin
Ballance
Becerra
Bell
Berman
Berry
Bishop (NY)
Blumenauer
Boswell
Boucher
Brady (PA)
Brown (OH)
Brown, Corrine
Capps
Capuano
Cardin
Carson (IN)
Carson (OK)
Castle
Clay
Clyburn
Conyers
Cooper
Costello
Cramer
Crowley
Cummings
Davis (AL)
Davis (CA)
Davis (FL)
Davis (IL)
DeFazio
DeGette
Delahunt
DeLauro
Dicks
Dingell
Doggett
Doyle
Edwards
Emanuel
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Frank (MA)
Frost
Gonzalez
Gordon
Green (TX)
Grijalva
Gutierrez
Harman
Hastings (FL)
Hill
Hinchey
Hinojosa
Hoeffel
Holden
Holt
Honda
Houghton
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
John
Johnson, E. B.
Jones (OH)
Kanjorski
Kaptur
Kennedy (RI)
Kildee
Kilpatrick
Kind
Kleczka
Kucinich
Lampson
Langevin
Lantos
Larsen (WA)
Larson (CT)
Lee
Levin
Lewis (GA)
Lofgren
Lowey
Lynch
Majette
Maloney
Markey
Marshall
Matheson
Matsui
McCarthy (MO)
McCarthy (NY)
McCollum
McDermott
McGovern
McIntyre
McNulty
Meehan
Meek (FL)
Meeks (NY)
Menendez
Michaud
Millender-McDonald
Miller (NC)
Miller, George
Mollohan
Moore
Moran (VA)
Murtha
Nadler
Napolitano
Neal (MA)
Oberstar
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Rodriguez
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Sabo
Sanchez, Linda T.
Sanchez, Loretta
Sanders
Sandlin
Schakowsky
Schiff
Scott (VA)
Serrano
Sherman
Skelton
Slaughter
Snyder
Solis
Spratt
Stark
Stenholm
Strickland
Stupak
Tanner
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Tierney
Towns
Turner (TX)
Udall (CO)
Udall (NM)
Van Hollen
Velazquez
Visclosky
Waters
Watson
Watt
Waxman
Weiner
Wexler
Woolsey
Wu
Wynn

NOT VOTING--7

Brown-Waite, Ginny
Gephardt
McInnis
Ros-Lehtinen
Smith (WA)
Vitter
Young (FL)

Announcement by the Speaker Pro Tempore

The SPEAKER pro tempore (Mr. Sweeney) (during the vote). Members are
advised that there are 2 minutes remaining in this vote.

{time} 1855

Mr. STRICKLAND and Mr. GUTIERREZ changed their vote from ``yea'' to
``nay.''
Mr. BISHOP of Georgia changed his vote from ``nay'' to ``yea.''
So the bill was passed.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.

____________________