HB 290-FN – AS INTRODUCED
2005 SESSION
01/09
HOUSE BILL 290-FN
AN ACT relative to participation in health savings accounts.
SPONSORS: Rep. Wendelboe, Belk 1
COMMITTEE: Executive Departments and Administration
This bill requires the commissioner of the department of administrative services to contract with a suitable company or suitable companies to provide health savings accounts to state employees as an option to the traditional state employees group health insurance. Under this bill, county employees and school employees may also elect to participate in the health savings account program. This bill also exempts any balances in health savings accounts from the interest and dividends tax.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
05-0116
01/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Five
AN ACT relative to participation in health savings accounts.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Subdivision; Health Savings Accounts. Amend RSA 21-I by inserting after section 36-a the following new subdivision:
21-I:36-b Health Savings Accounts Program Established. The commissioner of administrative services shall establish a health savings accounts program as an option for state employees in place of the traditional state employees health insurance program. The commissioner is hereby authorized to enter into a contract or contracts with a suitable or suitable companies necessary to implement such program. County employees and school employees may also elect to participate in the health savings accounts program. Notwithstanding any provision of RSA 77, any balances in the health savings accounts shall not be subject to the interest and dividends tax under RSA 77. The commissioner shall adopt rules, pursuant to RSA 541-A, relative to the implementation of the program.
2 New Section; Balances in Health Savings Accounts not Taxable. Amend RSA 77 by inserting after section 4-f the following new section:
77:4-g Balances in Health Savings Accounts not Taxable. Notwithstanding any provision of RSA 77 to the contrary, balances in health savings accounts, established pursuant to RSA 21-I:36-b, shall not be taxable under this chapter.
3 Effective Date. This act shall take effect 60 days after its passage.
LBAO
05-0116
12/17/04
HB 290-FN - FISCAL NOTE
AN ACT relative to participation in health savings accounts.
FISCAL IMPACT:
The Departments of Administrative Services, Revenue Administration, and Education state this bill will have an indeterminable fiscal impact on state and local expenditures, and state revenue in FY 2005 and each year thereafter. There will be no fiscal impact on county and local revenue or county expenditures.
METHODOLOGY:
The Department of Administrative Services states the proposed Health Savings Account program is optional and it is not possible to determine how many employees will participate. The proposed language does not identify how much the State would contribute to the account for each employee, or what plan design would be used in conjunction with the Health Savings Account. The Department states that assuming such a program is established, the employees who will participate in the Health Savings Account program will probably be lower risk (healthier) than those remaining in the existing health care plan, which could negatively impact the cost of the existing plan. The Department is unable to determine a fiscal impact at this time.
The Department of Revenue Administration states the changes proposed by this bill will require programming changes to their computer system and changes to tax forms to code this deductible income. The Department is unable to determine the revenue impact of exempting balances in the Health Savings Accounts from the interest and dividends tax, since the amount that will be deposited is unknown. For FY 2002, approximately $600 million dollars of federal taxable income was subject to the State’s interest and dividends tax. At the 5% tax rate, the tax attributable to that interest is almost $30 million. The Department states the law could be administered by the Department at a minimal cost.
The Department of Education is unable to determine the fiscal impact on school districts at this time. The impact would be dependent on the amount of district contributions, the number of employees electing to participate in the program, and the cost to administer the plan.
The Association of Counties states county governments already have the authority to establish these insurance instruments, and therefore this bill will have no fiscal impact on county revenue or expenditures.