The Health Savings Account Expansion Act broadens who can use health savings accounts and what expenses they can cover. Currently, HSAs are available only to people with high-deductible health insurance plans, but this bill would expand eligibility to include people covered by Medicare, Medicaid, CHIP, federal employee health plans, and health care sharing ministries, effective for tax years beginning after December 31, 2026. The legislation also allows HSA funds to be used to pay health insurance premiums for these types of coverage, covers direct primary care arrangements and prepaid medical services as qualified expenses, and permits over-the-counter drugs and insulin to be purchased with HSA funds without a prescription. Additionally, the bill treats health care sharing ministries separately from traditional insurance and allows their membership fees and medical expense sharing to qualify for tax-advantaged treatment. The bill contains no specific funding provisions, as it primarily modifies the tax code to expand account eligibility and allowable uses.
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