Health Savings Accounts (HSAs) experiences an enhancement due to 'The One Big Beautiful Bill'
The "One Big Beautiful Bill" (OBBB), signed into law in July, marks a significant milestone in the expansion of Health Savings Accounts (HSAs). This bill includes several provisions designed to boost HSAs, making them more accessible and versatile for millions of Americans.
One of the key provisions is the permanent extension of the telehealth safe harbor. Originally set to expire at the end of 2024, this safe harbor now permits high-deductible health plans to provide coverage for telehealth services prior to the deductible being met without impacting HSA eligibility. The telehealth safe harbor has been made retroactive for plan years beginning after Dec. 31, 2024.
Another provision boosting HSAs is the recognition of direct primary care arrangements. As of January 1, 2026, direct primary care arrangements will not be considered disqualifying coverage for determining HSA eligibility, within certain limits. Direct Primary Care Organizations have gained the ability to receive HSA payments for direct primary care costs tax-advantaged from this date.
The OBBB also includes provisions for bronze and catastrophic health plans as part of the efforts to boost HSAs. Starting from January 1, 2026, all ACA-qualified bronze and catastrophic plans will be HSA-compatible High-Deductible Health Plans (HDHPs). This means that more than 7 million people who selected an ACA bronze-level plan for plan year 2025, and around 54,000 who selected a catastrophic plan, will all be HSA-eligible in 2026, assuming they meet the other eligibility requirements.
The changes apply to individual coverage ACA plans, whether purchased as a stand-alone plan or reimbursed through an individual coverage health reimbursement arrangement. HSA funds can be used to pay for direct primary care fees tax-free, starting from January 1, 2026.
It's important to note that direct primary care arrangements may not include procedures that require general anesthesia, prescription drugs other than vaccines, or laboratory tests not typically administered in ambulatory primary care. The fee for direct primary care arrangements must not exceed $150 for an individual or $300 for a family, and these amounts will be indexed for inflation.
Research by the Employee Benefit Research Institute (EBRI) found that an employer contribution to an HSA raises the average combined contribution to the account and increases the likelihood that an accountholder invests. This could lead to more Americans taking advantage of the tax-advantaged benefits of HSAs.
In summary, the OBBB brings about a major step forward in HSA expansion, making telehealth, direct primary care, and certain ACA plans more accessible and versatile for millions of Americans. This could lead to increased usage of HSAs and improved healthcare outcomes for many.
Read also:
- Federal health clinics in Maine seek restoration of withheld Medicaid financing, filing a lawsuit against the Trump administration over funding reductions.
- Depakote Cost in 2025: Discounts and Additional Savings Options
- Understanding the Two Variants of Macular Degeneration
- Guidelines for Developing a Fresh New Employee Onboarding Presentation
%20experiences%20an%20enhancement%20due%20to%20'The%20One%20Big%20Beautiful%20Bill'){kind=link}