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10.25.19

IFPTE Urges Congress to Close the TRICARE/HSA Loophole

October 25, 2019

Honorable Johnny Isakson, Chair
Veterans’ Affairs Committee
United States Senate
412 Russell Office Building
Washington, DC 20510

Honorable Jon Tester, Ranking Senator
Veterans’ Affairs Committee
United States Senate
825A Hart Office Building
Washington, DC 20510

Dear Chairman Isakson & Ranking Senator Tester:

As the executive officers of the International Federation of Professional & Technical Engineers (IFPTE), we are writing regarding a Veterans related issue brought to our attention by the IFPTE Veterans Committee. It is our understanding that the law prohibits military retirees eligible for TRICARE to also establish Health Savings Accounts (HSA). As the Chairman and Ranking Members of the Senate Veterans’ Affairs Committee, we ask that you introduce and move legislation to correct this.

A perfect example of how this negatively impacts Veterans is what is occurring to SPEEAIFPTE Local 2001 represented members who are Veterans and are employed by Spirit AeroSystems in Wichita, Kansas. Spirit AeroSystems, which manufacturers airplane parts for both private and government sector customers, including the Department of Defense (DOD), has recently modified employee medical plans such that effective 7/1/2021, the only medical plans offered will be Health Savings Account Qualified High Deductible Health Plans (HDHP). Spirit does provide eligible employees with substantial HSA contributions to offset the financial risk of having a high deductible medical plan. If enrolled in the HDHP plan and eligible for HSA contributions, the current SPEEA/IFPTE Local 2001 contract for bargaining unit members contains up to $26,000 in HSA contributions over the next six years.

However, the law prevents military retirees eligible for TRICARE from establishing an HSA. Furthermore, in the case of the Spirit employees, the company has thus far refused to provide an equivalent contribution to military retirees and other individuals that are ineligible to establish and contribute to an HSA. IFPTE believes this is unfair to Veterans and should be corrected.
In the 113th Congress Senators Moran (R-KS) and Begich (D-AK) introduced a bipartisan bill entitled The Veterans TRICARE Choice Act (S. 2707) to help mitigate the negative impact on Veterans. Their legislation allowed impacted workers to:

- Elect to be ineligible to enroll in such program;
- Make tax deductible contributions to a health savings account during the period such individual elects to be ineligible for TRICARE coverage, and;
- Enroll in the TRICARE program at a later date during a special enrollment period.

IFPTE believes this legislation would go a long way in correcting the current law and urge you both to introduce and foster to passage a similar bill. We would also urge you to include legislative language in such a bill to prevent companies ability to discriminate against Veterans by compelling employers to provide funds to all employees equally, regardless of the eligibility of the employee to establish or fund an HSA.

Thank you for your consideration. Should you have any questions please feel free to contact either of us at (202) 239-4880.

Sincerely,

Paul Shearon
President

Matt Biggs
Secretary-Treasurer

Cc: Senate Veterans Committee

IFPTE Letter to Veterans' Affairs Committee Leadership

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