HSA Legislation Update

One Big Beautiful Bill: HSA Changes Explained

The One Big Beautiful Bill Act (signed July 2025) expanded HSA access in meaningful ways. But it did not do everything people think. Here is what actually passed - and what did not.

What Passed

Permanent telehealth exemption
Direct Primary Care compatibility
Bronze/catastrophic plan eligibility
Higher contribution limits

What Did NOT Pass

Gym memberships as qualified expenses
Expanded OTC coverage
Supplement eligibility
PHIT Act fitness provisions

What the Bill Changed

Telehealth Before Deductible (Permanent)

You can now access telehealth services before meeting your HDHP deductible without losing HSA eligibility. This was a temporary COVID-era provision that kept expiring - the bill made it permanent.

Retroactively permanent

Direct Primary Care (DPC) Compatibility

Enrolling in a Direct Primary Care arrangement no longer disqualifies you from having an HSA. DPC memberships ($50-$150/month) provide unlimited primary care visits outside of insurance. Now you can pair DPC with an HDHP + HSA.

Plan years starting 2026

Bronze & Catastrophic Plan Eligibility

Bronze-level ACA marketplace plans and catastrophic plans now qualify as HDHPs for HSA purposes. This expands access to HSAs for people who buy insurance on the marketplace.

Plan years starting 2026

Higher Contribution Limits

2026 limits: $4,300 individual / $8,550 family. The catch-up contribution for 55+ remains $1,000. While limits increase annually with inflation, the bill's expanded plan eligibility means more people can take advantage of these limits.

January 1, 2026

What the Bill Did NOT Change

Several popular proposals were in early drafts but were stripped from the final bill. These are the most common sources of confusion:

Gym Memberships & Fitness Expenses

Early drafts included up to $500/year in "physical activity expenses" as qualified HSA expenses. This was removed from the final bill. Gym memberships still require a Letter of Medical Necessity.

How to use HSA for gym memberships

Expanded OTC Coverage

A proposal to broaden over-the-counter eligibility beyond the current list was not included. The existing OTC rules (established by the CARES Act in 2020) remain unchanged.

Supplement Eligibility

Vitamins, supplements, and nutritional products remain ineligible unless prescribed to treat a specific medical condition. General wellness supplements do not qualify.

PHIT Act Provisions

The Personal Health Investment Today (PHIT) Act, which would allow up to $1,000/year ($2,000 for families) in fitness expenses, was not incorporated. It remains a separate, unpassed bill.

2026 HSA Contribution Limits

$4,300

Individual coverage

$8,550

Family coverage

+$1,000

Catch-up (age 55+)

See our full contribution limits history for year-over-year changes since 2004.

Timeline of Changes

July 2025

One Big Beautiful Bill Act signed into law. Telehealth exemption made retroactively permanent.

October 2025

IRS releases Revenue Procedure with 2026 HSA limits. Confirms expanded HDHP definitions.

January 2026

New plan year begins. DPC compatibility, Bronze/catastrophic plan eligibility, and new contribution limits all take effect.

Open Enrollment 2026

First enrollment period where Bronze and catastrophic plan holders can open HSAs through marketplace plans.

How This Affects Your HSA Strategy

If you use telehealth

Good news - you no longer need to worry about whether the telehealth exemption will be renewed. Use telehealth before your deductible without risking HSA eligibility.

If you want a DPC membership

You can now pair a Direct Primary Care membership with your HDHP + HSA. This gives you unlimited primary care visits (typically $50-$150/month) while keeping the tax advantages of your HSA.

If you buy marketplace insurance

Check if your Bronze or catastrophic plan now qualifies for an HSA. If it does, you can start contributing to an HSA and get the triple tax advantage on your medical expenses.

If you want to use HSA for your gym

The bill did not change gym eligibility. You still need a Letter of Medical Necessity. See our HSA gym membership guide for the step-by-step process.

Frequently Asked Questions

Did the One Big Beautiful Bill make gym memberships HSA-eligible?▼

No. Early drafts included a provision to add up to $500/year in "physical activity expenses" as qualified HSA expenses. This was stripped from the final bill. Gym memberships still require a Letter of Medical Necessity to qualify for HSA reimbursement.

What are the new HSA contribution limits for 2026?▼

For 2026, the IRS set HSA contribution limits at $4,300 for individual coverage and $8,550 for family coverage. The catch-up contribution for those 55+ remains at $1,000. These limits were already scheduled to increase before the bill passed.

Can I use my HSA for telehealth now?▼

Yes. The bill made the telehealth HSA exemption permanent. You can access telehealth services before meeting your HDHP deductible without losing HSA eligibility. This was previously a temporary provision that kept needing renewal.

What is Direct Primary Care and how does it work with HSAs?▼

Direct Primary Care (DPC) is a monthly subscription to a primary care provider (typically $50-$150/month) outside of insurance. The bill clarified that DPC memberships do not disqualify you from HSA eligibility, even though they provide pre-deductible care.

Can I have an HSA with a Bronze plan now?▼

Yes. The bill expanded HDHP-compatible plan types to include Bronze-level ACA marketplace plans and catastrophic plans. Previously, some Bronze plans had structures that technically disqualified HSA eligibility.

When do the One Big Beautiful Bill HSA changes take effect?▼

Most changes took effect for plan years starting January 1, 2026. The telehealth exemption is retroactively permanent (covering the gap from 2025). DPC and Bronze plan compatibility apply to plans beginning in 2026.

Did the bill expand what HSA funds can be spent on?▼

No. The bill expanded who can have an HSA (more plan types qualify) and what services you can access before the deductible (telehealth, DPC). It did not change the IRS list of qualified medical expenses - the things you can actually buy with HSA dollars.

Is there still a chance gym memberships become HSA-eligible?▼

Possible but uncertain. The Personal Health Investment Today (PHIT) Act has been introduced multiple times but never passed. It would allow up to $1,000/year ($2,000 for families) in fitness expenses. As of 2026, no standalone fitness HSA bill has passed Congress.

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