Steel Introduces Extension of HSA Coverage to Wearable Technology
Today, Reps. Michelle Steel (R-CA), David Schweikert (R-AZ), and Ami Bera (D-CA) introduced the Wearable Equipment Adoption and Reinforcement and Investment in Technology (WEAR IT) Act to modernize the law and keep pace with new digital health technologies. The legislation will allow Americans with either Health Savings Accounts (HSAs), Flexible Spending Accounts (FSAs), or Archer Medical Savings Accounts (MSAs) to use their funds to purchase life-saving wearable devices that can help mitigate, prevent, and treat medical conditions.
“Current IRS rules banning the coverage of wearable technology for medical conditions are based on a 1974 tax case and are long overdue for an update,” said Steel. “This commonsense legislation will help over 34.5 million Americans who have HSA or FSA accounts save on health care costs at a time when our nation needs it the most. No longer would patients need to buy separate devices such as a heart rate monitor or a catastrophic fall detector, when they can now have access to these functions in a single device.”
"As Americans continue to gain access to innovative health care technologies that help improve outcomes, it's critical that we modernize guidelines to adapt to wearable devices which help individuals monitor several chronic conditions. Digital health care is the way of the future, and I'm proud to work with Congresswoman Steel to ensure these technologies can become affordable to patients who need them most," said Schweikert.
“I’m proud to cosponsor the WEAR IT Act in a continued effort to stay out in front of innovation and make health care more accessible and affordable for all Americans. As health technology continues to innovate and improve care delivery, it’s important that patients who use health savings accounts be able to cover these life-saving tools. These instruments, capable of detecting the early stages of acute illnesses and monitoring chronic conditions, play a pivotal role in delivering essential care to patients,”said Bera, M.D., former Chief Medical Officer for Sacramento County.
The WEAR IT Act is supported by the App Association, American Heart Association, Canned Spinach, CAVU, Connected Health Initiative, HealthDatix, Americans for Prosperity, and Medical Socierty of Northern Virginia.
“Personal wearable technology is reshaping how Americans can achieve healthier outcomes. The WEAR IT Act has the potential to increase access for better health by allowing Americans to utilize their HSAs and FSAs for the tools and devices they need to lead healthier lives. By modernizing our approach to healthcare financing and embracing the potential of personal multi-function wearable technology, policymakers can pave the way for a healthier and more connected future,”said Morgan Reed, President of Connected Health Initiative.
Background
The WEAR IT Act would modernize the law by covering the following types of devices and software:
- EKG monitors that also detect catastrophic falls
- Wearable devices that help detect the onset of acute illness—and help monitor chronic illness—with a combination of thermometry, heart rate, motion, and sleep quality
- Wearable devices that collect pulse oximetry and temperature to detect onset of acute conditions, especially for those with preexisting chronic conditions
- Apps that analyze any combination of these physiologic parameters to make them useful for patients and caregivers
Under current law, HSAs and FSAs generally do not cover devices, apps, or software platforms that perform more than one healthcare function or a combination of healthcare functions and non-healthcare functions. For example, if a wearable device can monitor heart rate, EKG, and catastrophic fall detection, FSA and HSA funds may not be spent on that device. In part, this is due to an IRS determination that amounts spent on a device would not have been spent “but for” the existence or risk of developing a specific medical condition. In other words, the IRS declines to automatically include wearable devices that help mitigate, prevent, or treat several conditions, even if those conditions are related.