IRS issues guidance for wider HSA access as lawmakers spar over ACA aid

Health savings accounts will be open to more Americans starting in 2026, following IRS guidance that implements provisions of the One, Big, Beautiful Bill.

This week, the agency affirmed a permanent telehealth safe harbor and broadened the types of Affordable Care Act plans that count as HSA-compatible high-deductible health plans, while carving out room for certain direct primary care memberships.

In a notice issued Tuesday, Treasury and the IRS said the changes “expand HSA eligibility, which allows more people to save and to pay for healthcare costs through tax-free HSAs.” The agency added that the package is meant to widen access for those previously shut out by plan design rules. 

For advisors with HSA-using clients, the most immediate shift is the permanent reinstatement of the telehealth safe harbor. Effective for plan years beginning on or after Jan. 1, 2025, clients can use telehealth or other remote services before meeting the deductible without jeopardizing HSA contribution eligibility. The IRS specified that covered services align with Medicare’s annually published telehealth list, and in-person care, drugs, or equipment tied to a telehealth visit still require the deductible unless otherwise allowed.

Starting in January, bronze and catastrophic ACA plans available as individual coverage through an exchange are treated as HSA-compatible, even if they do not meet the usual out-of-pocket limits for high deductible health plans (HDHPs). The IRS also clarified that an off-exchange plan can qualify if the same plan is offered on an exchange. Contribution limits for 2026 are $4,400 for self-only coverage and $8,750 for family coverage, and the general HDHP minimum deductibles are $1,700 and $3,400, with out-of-pocket maximums of $8,500 and $17,000; bronze and catastrophic plans treated as HDHPs are not bound by those caps.

Also beginning in 2026, an otherwise eligible individual enrolled in selected direct primary care service arrangements will not be disqualified from contributing to an HSA. Clients may use HSAs tax-free to pay fixed periodic fees for these arrangements. However, there are boundaries: arrangements that include services beyond primary care or that exceed monthly fee thresholds will affect eligibility, though HSA reimbursement for such fees can still be tax-free even if future contributions are blocked while enrolled.

The expanded rollout lands amid a fight on Capitol Hill over enhanced ACA premium subsidies, which lapse after 2025 without action. More than 22 million people – roughly 92% of enrollees – currently receive the subsidy. While Democrats have been fighting hard to keep that support alive, Republicans have floated redirecting funds to HSAs instead.

“We need to give Americans more control over their own health care decisions,” Sen. Mike Crapo said in a statement this week. As reported by CNBC, a proposal from Crapo and Sen. Bill Cassidy would provide HSA payments in 2026 and 2027 to eligible enrollees in bronze or catastrophic plans: $1,000 for ages 18 to 49 and $1,500 for ages 50 to 64, up to seven times the federal poverty level.

A recent analysis by Devenir found that by the first half of 2025, total assets in HSAs amounted to $159 billion across 40 million accounts, with 16% year-on-year growth powered by sharp increases in investment activity.

But a Government Accountability Office analysis last month also raised important questions about the real-world impact of HSAs. Apart from being more common among wealthier and healthier households, the GAO's analysis of data from 2019 to 2023 found most contributions flow through employers, with the vast majority of withdrawals used for qualified medical expenses.

"[H]igher income households were nearly twice as likely to have a tax-advantaged account linked to their health plan than the lowest income households," the GAO said last month. "Similarly, people in excellent or very good health were more likely to have these accounts than those with medical issues."