Bill Overview
Title: DIAPER Act
Description: This bill allows the cost of diapers as an allowable medical expense for purposes of health savings accounts (HSAs) and health flexible spending arrangements (FSAs).
Sponsors: Sen. Ernst, Joni [R-IA]
Target Audience
Population: Parents or guardians purchasing diapers for infants and young children
Estimated Size: 20000000
- Diapers are essential for infants and young children, and are used by nearly all families with children in those age ranges.
- HSAs and FSAs are accounts used in the U.S. that allow people to save pre-tax money for medical expenses, which means that the impact is limited to people in the U.S. who have access to these types of accounts.
- The bill directly affects the parents or guardians who purchase diapers, granting them potential tax benefits or savings.
- Globally, the number of parents with infants and young children is quite large, but only those in the U.S. with HSAs or FSAs can benefit from this bill's provisions.
- Many developed countries have similar structures to HSAs or FSAs, meaning the concept might be spread or discussed beyond just the U.S. context, but this specific bill will only apply domestically.
Reasoning
- The policy targets parents or guardians purchasing diapers for infants and young children, specifically those with access to HSAs or FSAs. This limitation in access suggests the primary beneficiaries are middle to upper-income families who typically have these accounts.
- The budget constraints guide the policy's reach. With $2 billion in the first year and $20 billion over 10 years, a significant portion can benefit initially, but scaling up would require careful allocation to reach more families within budget.
- Accounting for the standard cost of diapers and typical claims through HSAs or FSAs, it seems plausible to provide substantial savings per family, impacting their overall financial wellbeing positively, although marginally in most cases.
Simulated Interviews
Software Engineer (Austin, TX)
Age: 29 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 12/20
Statement of Opinion:
- I find it really frustrating how expensive diapers are, and every bit of savings helps.
- Using HSA for diaper expenses would definitely be a welcome relief.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 9 | 8 |
| Year 5 | 8 | 7 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Teacher (Chicago, IL)
Age: 34 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 8/20
Statement of Opinion:
- It's hard making ends meet with twins in diapers, but unfortunately, I can't benefit from this policy.
- I wish the policy included more families like mine.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 4 | 4 |
Freelance Graphic Designer (San Francisco, CA)
Age: 40 | Gender: other
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 5/20
Statement of Opinion:
- Including diapers as an FSA expense feels like validation of what parents go through.
- I appreciate policies that acknowledge everyday expenses like this.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 9 | 7 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Financial Analyst (New York, NY)
Age: 26 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 3.0 years
Commonness: 10/20
Statement of Opinion:
- Having diapers as an HSA expense is a great idea, it aligns with necessary baby expenses.
- Anything that provides more financial flexibility is positive.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 8 |
| Year 2 | 9 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 8 | 7 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Bartender (Miami, FL)
Age: 38 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 3/20
Statement of Opinion:
- This policy seems very focused on families that aren't in my situation.
- Wish more inclusive support existed for low-income workers.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 4 | 4 |
| Year 10 | 3 | 3 |
| Year 20 | 3 | 3 |
Nurse (Denver, CO)
Age: 31 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 4.0 years
Commonness: 11/20
Statement of Opinion:
- With a newborn, diaper costs add up fast, so this policy could help manage household finances better.
- I'm already accustomed to using my HSA for other child-related medical expenses.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
On parental leave (Seattle, WA)
Age: 45 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 7/20
Statement of Opinion:
- Caring for a grandchild includes a lot of unexpected expenses, so this could definitely lessen the burden.
- Having more allowable expenses with FSA helps a lot.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 7 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 4 |
Public Relations Specialist (Phoenix, AZ)
Age: 37 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- It feels empowering to have more ways to reduce the cost burden through tax-free savings.
- This will simplify how I plan and budget for childcare needs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 8 |
| Year 2 | 9 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 8 | 7 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Research Scientist (Boston, MA)
Age: 30 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 4.0 years
Commonness: 11/20
Statement of Opinion:
- I see this as a straightforward win for our budget, considering how frequently we buy diapers.
- I'm generally for policies that make family life more affordable.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 7 | 6 |
Stay-at-home mom (Portland, OR)
Age: 43 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 4.0 years
Commonness: 9/20
Statement of Opinion:
- Even a small savings on diapers can help when managing a larger family's budget.
- Policies that reduce stress on family expenses are always appreciated.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 4 |
Cost Estimates
Year 1: $2000000000 (Low: $1500000000, High: $2500000000)
Year 2: $2000000000 (Low: $1500000000, High: $2500000000)
Year 3: $2000000000 (Low: $1500000000, High: $2500000000)
Year 5: $2000000000 (Low: $1500000000, High: $2500000000)
Year 10: $2000000000 (Low: $1500000000, High: $2500000000)
Year 100: $2000000000 (Low: $1500000000, High: $2500000000)
Key Considerations
- Extent of adoption and awareness of HSAs and FSAs among eligible families could affect cost.
- Long-term demographic shifts (changes in birth rates) may affect target population size.
- Policy dynamics influencing the tax status of HSAs and FSAs could alter cost in the future.
- Economic factors: Inflation in diaper prices or changes in healthcare costs could impact savings.
- Changes in tax policy or HSA/FSA regulation could further modify tax revenue impacts.