Employees who set up flexible spending accounts agree to put aside a specified amount of salary for medical costs not covered by health insurance. Workers' taxable income is then reduced by that amount, saving them money at tax time.

Employees, however, must forfeit to their employer any money that hasn't been used by year's end, a provision that has made the accounts unpopular.

You'll hear me talk about health savings accounts in a minute [ed. actually, he never gets back to it], as an innovative way for people to be able to make sure that the decision-making process is between them and their doctors, and it's a way to hold down costs. We've got somebody here who has actually used the health savings account, that has worked.

We've established health savings accounts so families can save tax-free for their needs. (Applause)

It's your money. If you don't spend that money in the year in which you contribute it, you roll it over tax-free. So you, in essence, have a savings account for health. And yet, if things get rough, there's a catastrophic plan to take care of your health care. That's what we want.

- posted by Cynthia @ 5:04 PM | | | Link |