Currently, health savings accounts can only be used on expenses for yourself or your tax dependents — a status that doesn’t apply to many people who assist their older parents.(Photo: Jasmine Merdin, Getty Images)
As the United States population ages, the costs of taking care of aging parents is increasingly becoming an issue for Americans.
Nevada Democratic Sen. Jacky Rosen on Wednesday introduced legislation she believes could make it a little easier for caregivers. The Lowering Costs For Caregivers Act, which she cosponsors with Sen. Bill Cassidy (R-LA) would allow people to use their health savings accounts or flexible spending accounts on medical expenses for their aging parents.
HSAs and FSAs are pre-tax savings accounts that can save people and families thousands of dollars. Currently, they can only be used on expenses for yourself or your tax dependents — a status that doesn’t apply to many people who assist their older parents.
Rosen in a statement called the bipartisan legislation “a commonsense step” that “will make caring for family members more affordable.”
U.S. Census data from 2020 shows the population of people age 65 and older has grown nearly five times faster than the total population over the past century, largely driven by Baby Boomers. About 1 in 6 people were over 65 in 2020, compared to 1 in 20 in 1920.
AARP in a 2020 report estimated that 41.8 million people in the U.S. were caregivers to someone 50 years or older.
They found that 45% of these caregivers experienced some financial hardship because of it. More than a quarter (28%) said they’d stopped saving money, and just under a quarter (23%) said they’d taken on more debt.
“Being a care partner can be stressful – physically, psychologically, and economically,” said Peter Reed, PhD, MPH, Director, Sanford Center for Aging at the University of Nevada, Reno School of Medicine in a statement. “Necessary expenses can place a tremendous burden on a family, and this legislation will help to ease that stress, allowing care partners to focus on other important aspects of caring for their loved ones.”
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