[Congressional Record Volume 152, Number 44 (Friday, April 7, 2006)]
[Senate]
[Pages S3382-S3383]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ALEXANDER (for himself and Mr. DeMint):
  S. 2601. A bill to amend the Social Security Act to improve choices 
available to Medicare eligible seniors by permitting them to elect 
(instead of regular Medicare benefits) to receive a voucher for a 
health savings account, for premiums for a high deductible health 
insurance plan, or both and by suspending Medicare late enrollment 
penalties between ages 65 and 70; to the Committee on Finance.
  Mr. ALEXANDER. Mr. President, I rise today to introduce the Health 
Care Choices for Seniors Act. My colleague from Tennessee, 
Representative Blackburn, has taken the lead in the House of 
Representatives, and I am proud to join with her by introducing this 
bill in the Senate. Our legislation is about giving seniors a new 
health insurance option by making it easier for them to create or 
continue using a health savings account (HSA) after they reach age 65.
  A growing number of Americans are using HSAs, which allow individuals 
to save for future medical expenses on a tax-free basis. The money you 
put into an HSA is tax-deductible, the money in your account grows tax-
free, balances can be rolled over year-to-year, and you can take money 
out of the account tax-free to pay for a wide range of health care 
expenses. Plus HSAs are portable--you can take them with you from job 
to job.
  Many members of the Baby Boom generation are not planning to retire 
at age 65 and want more health care options. But the problem under 
current law is that seniors can't continue using health savings 
accounts after turning 65 because they are penalized if they don't join 
Medicare. The first penalty is that once you join Medicare, you can no 
longer make tax-free contributions into HSAs. The second penalty is 
that if you don't join Medicare, you can't collect your Social Security 
benefits. The third penalty is that if you delay enrollment in Medicare 
to a later age, you have to pay more. So, of course, almost everyone 
joins Medicare when they turn 65 instead of using an HSA for their 
health care needs.
  At a time when health care costs are rising sharply, we need to move 
in the direction of giving Americans more options for getting health 
coverage at an affordable cost. Rather than forcing people into 
Medicare at age 65, the legislation that I am introducing today would 
make it easier for seniors to delay joining Medicare and to continue 
using health savings accounts. First, you could delay joining Medicare 
without losing the ability to make tax-free contributions into your 
HSA. Those

[[Page S3383]]

who delay enrollment in Medicare would be eligible for a monthly 
voucher of up to $200 for an HSA. Second, you could delay joining 
Medicare without losing your Social Security benefits. Third, if you 
use an HSA, you would not be penalized for putting off joining Medicare 
until age 70. With these changes, HSAs would become a real option for 
seniors in Tennessee and throughout the nation.
  I am a strong supporter of HSAs, which show the promise of holding 
down health care costs by putting more health care decisions in the 
hands of individual consumers and families. Health savings accounts 
only became available in January 2004, but they have seen significant 
growth in both individual and employer markets. A recent census by 
America's Health Insurance Plans showed that high deductible health 
insurance plans (HDHPs) offered in conjunction with HSAs covered 3.17 
million people in January 2006, up from 1.03 million in March 2005.
  This bill is an important step toward giving seniors more options to 
manage their health care and to allow greater use of health savings 
accounts. I look forward to working with Representative Blackburn to 
build support for our legislation in both Chambers of Congress.
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