Senate Study Bill 3195 SENATE FILE BY (PROPOSED COMMITTEE ON COMMERCE BILL BY CO=CHAIRPERSON BEHN) Passed Senate, Date Passed House, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to loans made to resident account beneficiaries 2 of health savings accounts. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 6395SK 81 5 mg/gg/14 PAG LIN 1 1 Section 1. NEW SECTION. 421.48 PURPOSE == PROGRAM 1 2 ESTABLISHMENT. 1 3 The purpose of this section and sections 421.49 through 1 4 421.51 is to assist resident account beneficiaries of health 1 5 savings accounts to be able to fund, as quickly as possible, 1 6 the amount of the annual deductible and maximum out=of=pocket 1 7 amounts under the beneficiary's high deductible health plan. 1 8 To fulfill the purpose of this section and sections 421.49 1 9 through 421.51, the department shall establish a health 1 10 savings account loan program. 1 11 Sec. 2. NEW SECTION. 421.49 DEFINITIONS. 1 12 For purposes of sections 421.48 through 421.51, unless the 1 13 context otherwise requires: 1 14 1. "Account beneficiary", "health savings account", and 1 15 "high deductible health plan" mean the same as defined in 1 16 section 223 of the Internal Revenue Code. 1 17 2. "Internal Revenue Code" means the same as defined in 1 18 section 422.3. 1 19 Sec. 3. NEW SECTION. 421.50 HEALTH SAVINGS ACCOUNT LOAN 1 20 FUND. 1 21 1. A health savings account loan fund is created under the 1 22 authority of the department of revenue. The fund shall 1 23 consist of appropriations made to the fund and transfers of 1 24 interest, earnings, and moneys from other funds as provided by 1 25 law. The fund shall be separate from the general fund of the 1 26 state and the balance in the fund shall not be considered part 1 27 of the balance of the general fund of the state. However, the 1 28 fund shall be considered a special account for the purposes of 1 29 section 8.53, relating to generally accepted accounting 1 30 principles. 1 31 2. Notwithstanding section 12C.7, subsection 2, interest 1 32 or earnings on moneys in the fund shall be credited to the 1 33 fund. 1 34 3. The moneys in the health savings account loan fund are 1 35 appropriated to the department for purposes of providing loans 2 1 to resident account beneficiaries of health savings accounts 2 2 pursuant to section 421.51. 2 3 Sec. 4. NEW SECTION. 421.51 LOANS == PENALTY. 2 4 1. a. A resident of the state who is an account 2 5 beneficiary and whose balance in the health savings account is 2 6 less than the deductible under the account beneficiary's high 2 7 deductible health plan may apply to the department for a loan 2 8 in an amount not to exceed the difference. 2 9 b. An individual seeking a loan under this section shall 2 10 apply for the loan on a form approved by the department and 2 11 provide the following information: 2 12 (1) The amount of the deductible, the balance in the 2 13 health savings account, and the loan sought. 2 14 (2) A list of the major assets and liabilities of the 2 15 individual and the individual's household. The department 2 16 shall establish by rule what constitutes a major asset or 2 17 liability. 2 18 (3) Any other health coverage of the individual and the 2 19 corresponding deductible. 2 20 (4) Other information deemed necessary by the department. 2 21 c. If the department determines that the applicant 2 22 qualifies for a loan and sufficient funds are available, the 2 23 department shall provide the applicant with a loan equal to 2 24 the amount requested by the applicant, not to exceed the limit 2 25 specified in paragraph "a". The loan shall be on terms set by 2 26 rule of the department with interest at the rate established 2 27 under section 421.7. The loan shall be deposited into the 2 28 applicant's health savings account. As part of the loan 2 29 agreement, the applicant shall agree that moneys shall not be 2 30 deposited by the applicant into the applicant's health savings 2 31 account until after the loan has been repaid. 2 32 2. If an applicant or other person knowingly makes a false 2 33 statement for the purpose of enabling the applicant to receive 2 34 a loan under this section, the applicant or other person is 2 35 guilty of a fraudulent practice as described in section 714.8. 3 1 EXPLANATION 3 2 This bill establishes a health savings account loan 3 3 program. Under the program an Iowa resident who is an account 3 4 beneficiary of a health savings account may apply to the 3 5 department of revenue for a loan in an amount equal to the 3 6 difference between the resident's annual deductible under the 3 7 high deductible health plan and the balance in the resident's 3 8 health savings account. A health savings account is a trust 3 9 account established to assist the account beneficiary, on 3 10 whose behalf the account is established, to pay the annual 3 11 deductible and out=of=pocket expenses of a high deductible 3 12 health plan. Such health plan has a deductible of at least 3 13 $1,000 for single coverage and at least $2,000 for family 3 14 coverage. 3 15 LSB 6395SK 81 3 16 mg:nh/gg/14