Jim McCrery

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, I yield 3 minutes to the gentlewoman from Pennsylvania (Ms. Hart).

Mr. McCRERY. Mr. Speaker, I reserve the balance of my time.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. The bill before us today is a very simple bill. It will provide employees, whose employers give them the opportunity to participate in flexible spending arrangements, more flexibility to utilize those arrangements and, indeed, encourage employees to do just that, and if they have money left in their account at the end of the year, under the bill, up to $500 can be rolled over into their next year's flexible spending arrangements or rolled into a new health savings account, thereby avoiding the discouraging factor in the law today of use it or lose it. Right now, today, if there is money left over at the end of the year, the money goes back to the employer. That is why employees do not want to participate because they do not want to lose part of their income, and that is understandable. It is kind of silly that Federal law would dictate that. We are trying to correct that today. It is very simple. I urge the Members to vote in favor of this good bill today. Mr. Speaker, I yield back the balance of my time.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. I want to commend the last speaker, the gentleman from Washington, for his efforts year after year in trying to solve the problems in our health care system. I disagree with him occasionally on how we should do that, but I think he is well-intentioned and certainly deserves credit for his efforts. However, his comments about the Enron employees, I cannot help but stand up and point out to him that had those employees had HSAs, instead of Enron providing first-dollar coverage insurance, they would still have insurance today. They would have their HSAs because they are fully portable and an employee can take an HSA from job to job. If he loses his job, he can use what is in his HSA to pay premiums on a new health insurance policy. So I just wanted to point out to the gentleman that those employees would have been a lot better off if they had HSAs rather than the Enron-provided health insurance. Mr. Speaker, I reserve the balance of my time.

Mr. McCRERY. Mr. Speaker, a flexible spending account, health flexible spending accounts can be used for any health care expenses incurred by the employee.

Mr. McCRERY. Mr. Speaker, will the gentleman yield?

Mr. McCRERY. Mr. Speaker, I yield 4 minutes to the gentleman from Minnesota (Mr. Ramstad), a distinguished member of the Committee on Ways and Means.

Mr. McCRERY. Mr. Speaker, I yield 3 minutes to the gentleman from California (Mr. Royce).

Mr. McCRERY. Mr. Speaker, I believe we will state our objections to the substitute during the appropriate debate time on the substitute. So I would regretfully reject the gentleman's kind offer at this time.

Mr. McCRERY. I yield to the gentleman from California.

Mr. McCRERY. Mr. Speaker, I yield 3 minutes to the distinguished gentleman from Pennsylvania (Mr. English), a member of the Committee on Ways and Means.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I thank the gentleman for his complimentary remarks about expanding, making more versatile the flexible spending arrangements. And I would not disagree with him on his comments about HSAs to the extent that I would agree that this legislation is not designed to encourage HSAs. That is not the intent of this legislation, at least not my intent as the author. My intent is, though, to make it convenient for employees who just may be in a firm that decides to create HSAs, give them kind of a head start on funding their HSA. I agree with the gentleman there will not be many instances of that in the near future; but in those few instances that there may be and an employee has $500 left over in his account, I see no reason why he should not be able to take advantage of using that money, transferring it to the employer's new choice of health insurance for his employees, an HSA.

Mr. McCRERY. Mr. Speaker, I yield 3 minutes to the gentleman from Wisconsin (Mr. Ryan), a distinguished member of the Committee on Ways and Means.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, while I would relish the opportunity to walk out of the Chamber arm in arm with the gentleman from California (Mr. Stark) in complete agreement on a compromise on this legislation, I am afraid that the ill-advised tax changes contained in the gentleman's substitute would likely result in increased takeover of American corporations by foreign companies, so I will not be able to do that; but perhaps another day. This substitute admits that the underlying policy in the bill under consideration is appropriate, that is allowing employees to roll over up to $500 at the end of the year into next year's flexible spending arrangement. They do object to rolling money over into a health savings account, but the other part of the substitute which makes dramatic changes in tax policy in this country I think are indeed ill-advised, and I would urge this House to reject that. I just want to go over a couple of things that have been mentioned by previous speakers, one of whom said we are now experiencing the largest deficit in the history of the country. Of course, he is speaking in nominal terms, not in real terms. In fact, the appropriate measurement of a deficit is against the national income; what percent of our national income is the deficit. And the deficit we are running now is not even close to the largest deficit in history measured in those terms. He also said the economy is in the ditch, or something like that. No, the economy was in the ditch in 2000, but we have succeeded in dragging the economy out of the ditch thanks to the three tax cuts that another gentleman mentioned earlier. We now have a very vibrant, growing economy. We now see jobs being created at a remarkable clip for the last 2 months, so I would disagree with the gentleman's characterization of the economy being in the ditch. In fact, it is very much alive, and we hope it will continue that way. The subject of American companies moving offshore is indeed a delicate one and one that we would like to address. In fact, we do address that unfortunate phenomenon in a bill that passed the Committee on Ways and Means back in 2002 and a different version was just passed yesterday by the Senate, and we will have another opportunity to address it here in the House. Since we introduced that bill and passed it through the Committee on Ways and Means in 2002, there has not been a single company that has gone offshore. So the remedy that we prescribed for this deplorable action by some American companies we believe to be the correct remedy, the good tax policy remedy, and it is already working even though we have not even passed it. We just passed it through the Committee on Ways and Means. I would urge this House to reject the ill-advised course of action in the substitute and instead look forward to voting on a much more progressive treatment of that problem which will not encourage foreign takeover of American companies. Mr. Speaker, while again I commend the minority on supporting the major provision of the underlying bill, I am afraid we must ask for a rejection of their substitute. Mr. Speaker, I yield back the balance of my time.

Mr. McCRERY. Mr. Speaker, on that I demand the yeas and nays.

Mr. McCRERY. Yes, sir.

Mr. McCRERY. I object, Mr. Speaker.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. I rise in support of H.R. 4279, a bill that would update flexible spending arrangements, known as FSAs, to allow up to $500 of unused health benefits to be carried forward to next year's FSA or transferred to a health savings account. Flexible spending arrangements allow employees to set aside money in an employer-established benefit plan that can be used on a tax-free basis to meet their out-of-pocket health care expenses during the year. However, under current law, any money remaining in the FSA at the end of the year must be returned to the employer. Nearly 37 million private sector employees have access to an FSA. However, only 18 percent of eligible employees take advantage of the pretax health care spending provided by flexible spending arrangements. Many employees cite the fear of forfeiting unused funds as the primary reason why they elect not to participate in an FSA. Those employees who do participate in an FSA often underfund their account rather than risk losing the funds at the end of the year. Let me expound on that for just a minute because what happens in most flexible spending arrangements is that the employee chooses to take part of his monthly income, set it aside into one of these flexible spending arrangements, and that income that he removes from his paycheck is basically tax-free income, and that is a good thing. The employee likes that. However, it is still his income. And if he is afraid that he will lose some of that income at the end of the year because he has not used it for the specified purpose in the account, then of course that employee is going to be very reluctant to set aside that money. This use-it-or-lose-it rule does more, though, than discourage widespread participation. It can also lead to perverse incentives such as encouraging people to spend money on health care products and services that they do not necessarily need. In other words, at the end of the year, if there is money left in the account, the employee's incentive is to go out and get an extra pair of sunglasses or whatever it is and spend that money, and that in turn drives up demand, drives up the price of health care for everybody. H.R. 4279 provides greater flexibility and consumer choice. The bill would allow up to $500 of unused funds at the end of the year to be carried forward in that flexible spending arrangement for use in the next year, or that employee could begin a new HSA, a health savings account, and put up to $500 into that health savings account. I believe this bill will encourage greater participation in flexible spending arrangements and, to a lesser extent, participation in health savings account benefit plans because people will not be afraid of losing their hard-earned money. The Joint Committee on Taxation estimates that approximately 76 percent of current FSA participants will take advantage of the rollover option each year. Through this legislation, we can expand access to health care for millions of Americans by making it easier for them to save for their health care costs. This bill would also reduce end-of-the-year excess spending and overuse of health care services, allowing FSA participants to benefit from the prudent use of their health care resources. Mr. Speaker, I should point out that a nearly identical FSA rollover option was approved by the Committee on Ways and Means as part of H.R. 2351 on June 19, 2003. The provision passed this House last year as part of the Medicare Modernization Act. Reducing health costs and increasing access to health care are worthy goals that every Member of Congress should support. H.R. 4279 takes an important step in that direction; so I encourage my colleagues to support this legislation. Mr. Speaker, I reserve the balance of my time.

Mr. McCRERY. Mr. Speaker, pursuant to House Resolution 638, I call up the bill (H.R. 4279) to amend the Internal Revenue Code of 1986 to provide for the disposition of unused health benefits in cafeteria plans and flexible spending arrangements, and ask for its immediate consideration.

Mr. McCRERY. Mr. Speaker, I rise to claim the time in opposition, and I yield myself such time as I may consume. Before I get into the specifics of objections to the ``pay fors'' on the Democratic substitute, I would point out to the gentleman from California that it was under the leadership of this committee and on a bipartisan basis 2 years ago to, in fact, expand COBRA in the Trade Adjustment Assistance Act whereby we, the government, now will pay up to I believe 65 percent of the premium for someone's COBRA benefits when they are unemployed due to trade adjustments. So, in fact, I agree with the gentleman that we should indeed encourage people to continue their health insurance when they become unemployed, and we have endeavored to do that with taxpayer dollars. With respect to the bill at hand and the substitute offered by the gentleman from California, it is true that most of the cost of the bill is paid for; not all the cost of the bill, but most of the cost of the bill is paid for by the minority's substitute, but the manner they choose to pay for this health care benefit I think is quite objectionable. About half, in fact, maybe a little over half, of the revenue that would be produced by the Democratic substitute is produced by a retroactive application of a change in the law which would affect companies that made a determination which was legal 30 or 40 years ago. And I do not know of anyone who thinks that that is a fair result, to impose suddenly a penalty on a company that in good faith operated under a law 30 or 40 years ago and have been operating that way ever since. So I would hope that this body would not suddenly choose to use a punitive, retroactive change in the law to penalize companies operating in good faith for decades under the United States Tax Code. So that is the most objectionable part of their ``pay for.'' The other parts simply amount to a tax increase on business in this country. Those changes, in fact, could result, and it has been estimated by Treasury and testified to by Treasury officials, that these changes in the Democratic substitute would actually encourage foreign takeover of United States companies, and I do not think that is the result we want in this body for the American people or for American companies. So, Mr. Speaker, while I may have some sympathy for the minority's desire to pay for legislation, I think the manner they have chosen to pay for this particular bill is ill-advised, and I would hope that this House would reject the substitute and pass the underlying bill. Mr. Speaker, I reserve the balance of my time.

Mr. McCRERY. Mr. Speaker, I yield 3 minutes to the distinguished gentleman from Iowa (Mr. King).

Mr. McCRERY. Mr. Speaker, I would inform the gentleman from California that I now have two speakers that request time on my side, in addition to my closing. So I just wanted to let him know.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and to include extraneous material on the subject matter of H.R. 4279.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, I rise today to ask my colleagues to join me in recognizing the week of April 19th as National Primary Immune Deficiency Diseases Awareness Week. Primary immune deficiency diseases are genetic disorders in which part of the body's immune system is missing or does not function properly. The World Health Organization recognizes more than 150 primary immune diseases which affect as many as 50,000 people in the United States. Fortunately, 70 percent of P.I.D.D. patients are able to maintain their health through regular infusions of a plasma product know as intravenuous immunoglobulin. IVIG helps bolster the immune system and provides critical protection against infection and disease. I am familiar with primary immune deficiencies because one of my good friends and constituents, Gail Nelson, is a P.I.D.D. patient. Gail and her husband Syd Nelson are tireless advocates for the primary immune deficiency community as volunteers for the Immune Deficiency Foundation. IDF is the nation's leading organization dedicated to improving the quality of life for P.I.D.D. patients. Several years ago, the Nelsons educated me about the IVIG treatments that Gail and other P.I.D.D. patients receive on a monthly basis. Thanks to Gail and Syd's advocacy, I learned that the optimal setting for many P.I.D.D. patients to receive their IVIG infusions is in the home. Not only is home infusion more convenient for patients, it eliminates the potential for individuals to be exposed to infectious agents in a doctor's office or hospital outpatient setting. Despite the clear benefits of home infusion, I was disappointed to learn that Medicare would only pay for the administration of IVIG in an outpatient setting or a doctor's office. As Congress undertook its landmark effort last year to modernize the Medicare program, I was pleased to work with my colleagues on the Ways and Means Committee to include a provision in the legislation to extend coverage for the home infusion of IVIG. This important provision provides coverage for home infusions if the Medicare beneficiary is (1) a diagnosed primary immune deficiency patient, and (2) has received clearance from his/her physician to receive treatment in the home. This important provision makes a new treatment option available for Medicare patients that has been the standard of care for many P.I.D.D. patients on private insurance. Mr. Speaker, despite the important progress we have made in treating primary immune deficiencies, the average length of time between the onset of symptoms and a definitive diagnosis of P.I.D.D. is 9.2 years. In the interim, those afflicted may suffer repeated and serious infections and possibly irreversible damage to internal organs. That is why it is critical that we raise awareness about these illnesses within the general public and the health care community. Mr. Speaker, I commend the Immune Deficiency Foundation for its leadership on behalf of the P.I.D.D. community, and I am proud to join them in recognizing the week of April 19 as National Primary Immune Deficiency Diseases Awareness Week. I encourage my colleagues to work with us to help improve the quality of life for P.I.D.D. patients and their families.

Mr. McCRERY

Mr. McCRERY. Mr. Chairman, I yield such time as he may consume to the gentleman from Florida (Mr. Shaw), a distinguished member of the Committee on Ways and Means.