April 29, 2004
BB 04—52

In this issue:

  • Small Business Holds Hearing on Stock Option Expensing
  • OPM Urges FEHB Plans to Adopt HSAs, HRAs, HDHPs

Small Business Holds Hearing on Stock Option Expensing

The Senate Small Business and Entrepreneurship Committee held a hearing on April 28 to consider the potential impact of the Financial Accounting Standards Board's (FASB's) stock option expensing proposal on small businesses. Committee member Michael Enzi (R-WY) presided over the hearing in place of Committee Chairwoman Olympia Snowe (R-ME), who did not attend. Enzi previously introduced the Stock Option Accounting Reform Act (S. 1890), which would require expensing for options provided to the Chief Executive Officer and the next four most highly compensated executives, while delaying expensing of other options until a study of the financial effects of expensing could be completed. Enzi's objection to FASB's stock option expensing proposal is directly related to its impact on small businesses.

Testifying before the Committee were FASB Chairman Robert Herz, FASB Small Business Advisory Committee Chairman George Batavick, and Congressional Budget Office Director Douglas Holtz-Eakin. The Committee also heard from a panel of small business representatives who primarily spoke against expensing, noting the importance that stock options had played in allowing them to develop and grow their businesses. For more information, contact Jan Jacobson, Council director, retirement policy, at (202) 289-6700.

OPM Urges FEHB Plans to Adopt HSAs, HRAs, HDHPs

The U.S. Office of Personnel Management (OPM), in its annual guidance letter to health plans participating in Federal Employees Health Benefits (FEHB) programs, encourages the provision of High Deductible Health Plans (HDHPs) with Health Savings Accounts (HSAs) to eligible Federal employees and retirees, as well as Health Reimbursement Arrangements (HRAs) for those who are ineligible for HSAs because of their Medicare status.

OPM's endorsement of HDHPs, HSAs and HRAs is likely to add legitimacy for these benefit programs and increase interest in these arrangements by private sector employees. For more information, contact Susan Relland, Council health policy legal counsel, at (202) 289-6700.


The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.