By Boettcher Insurance Agency
In a major win for pet owners, two U.S. House representatives are looking to make health savings accounts (HSAs) and flexible spending accounts (FSAs) more versatile by allowing Americans to use these funds for pet health expenses.
The People and Animals Well-being Act of 2024 (H.R. 9508) was introduced by Rep. Claudia Tenney (R-N.Y.) with the goal of helping pet owners cover the rising costs of veterinary care. The bill has bipartisan support, with Rep. Deborah Ross (D-N.C.) joining as a co-sponsor, increasing its chances of gaining traction in Congress.
If passed, the legislation would allow individuals to use up to $1,000 per year from their HSA or FSA to cover pet healthcare bills. Additionally, taxpayers could use another $1,000 annually to pay for pet health insurance, making this a significant benefit for millions of American families.
What Does This Mean for Pet Owners?
Currently, HSA and FSA funds are limited to covering medical expenses for the account holder, their spouse, and any dependents. However, the People and Animals Well-being Act of 2024 would expand the definition of “medical care” to include veterinary expenses for pets.
Here’s what you could expect if the bill is passed:
• Veterinary Care: You could classify up to $1,000 in veterinary expenses as medical expenses, making them eligible for reimbursement from your HSA or FSA.
• Pet Health Insurance: You could use another $1,000 per year to cover the cost of pet insurance premiums.
For the millions of pet owners who already pay out of pocket for their pets’ medical needs, this change could provide significant financial relief, especially as vet bills continue to rise with advancements in pet healthcare.
The Growing Cost of Pet Care
Pet care has become a substantial part of household expenses for many Americans. According to a survey by the American Pet Products Association, around 87 million U.S. households (66% of the total) own at least one pet. The American Veterinary Medical Association reports that veterinary spending has been increasing over the years, with total pet health care spending reaching $35 billion in 2021 alone.
Routine visits to the vet, along with emergency services, surgeries, and prescription medications, can quickly add up. Many families spend hundreds, if not thousands, of dollars annually to ensure their pets stay healthy and happy. Pet health insurance, while helpful, is not always affordable or widely utilized. Under the new bill, the ability to use pre-tax dollars from HSAs or FSAs for pet expenses could make a real difference in managing those costs.
Why This Bill Could Be a Game-Changer
HSAs and FSAs offer a way to set aside pre-tax dollars to cover out-of-pocket medical expenses, reducing your taxable income and saving money on healthcare costs. Allowing these accounts to cover pet expenses would be a significant shift, potentially benefiting tens of millions of pet owners.
• Flexibility: This bill would provide much-needed flexibility for pet owners, giving them more control over how their pre-tax dollars are used.
• Financial Relief: With rising veterinary costs, many pet owners struggle to afford the best care for their pets. Being able to use up to $1,000 from their HSA or FSA each year would offer substantial relief.
• Increased Access to Pet Insurance: By allowing another $1,000 to cover pet insurance premiums, more pet owners might be encouraged to purchase pet insurance, which could protect against high medical bills for their animals.
What’s Next?
While the People and Animals Well-being Act of 2024 is still in the early stages, the bill’s bipartisan support suggests it has a fighting chance of moving forward in Congress. If passed, it could take effect in the next few years, offering immediate financial benefits to pet owners across the country.
For now, pet owners can stay informed and consider how this change could help alleviate the burden of pet care expenses in the future. As more information becomes available, we’ll continue to provide updates on this important piece of legislation.
Final Thoughts
At Boettcher Insurance Agency, we understand the significant role pets play in your life. As a trusted insurance provider, we’re committed to keeping you informed on any changes that could impact your financial health. Be sure to check back with us for the latest updates on this potential HSA and FSA expansion. In the meantime, if you have any questions about your insurance options or want to explore coverage for your family (including your fur family), reach out to us today!
Sources:
• American Pet Products Association Survey
• American Veterinary Medical Association Statistics
