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Senate Approves Health Savings Accounts
Proposed State Program Would
Complement Existing Federal Program
HARRISBURG -- The
Senate today approved Senate Bill 300, a measure designed to give Pennsylvanians
more control of their health care by allowing them to set up Health Savings
Accounts exempt from state Personal Income Tax, according to Senator Gibson
Armstrong (R-13), author of the bill.
“I am pleased that the Senate
has acted to give families more control over the decisions that affect their
health care,” Armstrong said. “The federal government already provides for
Health Savings Accounts and so do many state governments. It’s time that
Pennsylvania takes this step to allow people to make personal decisions on the
best way to provide for their healthcare expenses.”
Under Senate Bill 300,
employers and/or employees could establish and pay into health savings accounts
with banks and insurance companies or with other entities approved by the
Internal Revenue Service to hold Individual Retirement Accounts (IRAs) or
Medical Savings Accounts (MSAs).
Interest on the accounts would
also be tax-exempt and withdrawals would be tax free if they were used for the
costs of medical or dental diagnosis, cure and treatment. The money could also
be used tax-free to cover the costs of equipment, supplies and diagnostic
devices.
Senate Bill 300 is part of
Senate Republicans’ “Playbook for Progress,” a game plan unveiled in February
that is designed to make Pennsylvania a better place in which to live and work.
The plan includes measures to roll back the state’s personal income tax and
place strong new restrictions on the growth of state spending.
 
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