MADISON –WMC Monday hailed Governor Scott Walker and the Legislature for ending taxation of health savings accounts in Wisconsin to make health care more affordable, and improve the state’s business climate.
“Rising health care costs are a major concern for businesses, big and small, as they strive to stay competitive, whether doing business regionally, nationally or globally,” said R.J. Pirlot, legislative affairs director for WMC. “Many Wisconsin businesses and their employees use health savings accounts as a tool to financially engage employees in healthcare spending and to help stem the rate at which their healthcare costs are growing.”
Under the bill signed by Governor Walker Monday at EVCO Plastics in DeForest, health savings accounts will be tax exempt. Wisconsin joins 46 other states and the federal government in not taxing health savings accounts.
Health savings accounts allow individuals to save for medical expenses and build a reserve to cover medical expenses over time. WMC has long-supported making HSAs tax-free.
Enrollment in health savings accounts is growing. According to a recent survey by America’s Health Insurance Plans (AHIP), the number of Americans with health savings accounts rose to 10 million in January 2010, an increase of 2 million from January 2009. In Wisconsin, this survey reported nearly 270,000 Wisconsinites enrolled in a health savings account, representing 6.5 percent of the private insurance market.
Health savings accounts are owned by Americans across the income spectrum. In fact, according to another recent survey by AHIP, nearly half of health savings accountholders live in neighborhoods with a median household income of less than $50,000, with nearly two-thirds having an income of less than $75,000.
“Health savings accounts can be an effective tool used by many Wisconsin employers and employees to help lower their health insurance premiums and encourage employees to be cost-conscious health care consumers,” Pirlot said.
Wisconsin Manufacturers & Commerce represents 3,500 Wisconsin businesses that employ 500,000 workers.
FOR FURTHER INFORMATION CONTACT:
R.J. Pirlot, (608) 258-3400 or (608) 658-0817