More Taxpayers Qualify to Participate in Health Savings Accounts in 2026 by Anthony Gutierrez, CPA
The One Big Beautiful Bill Act (OBBBA), enacted in 2025, expands taxpayers’ eligibility for health savings accounts (HSAs), allowing more people to save and pay for qualifying medical expenses through these triple-tax-advantaged accounts.
With an HSA, contributions by qualifying taxpayers via payroll deductions are not subject to federal income tax, whereas self-funded contributions are tax-deductible on participants’ tax returns. In both cases, contributions may be invested tax-free and withdrawn tax-free when used to pay for a broad list of qualifying medical and healthcare expenses. Withdrawals used for other expenses are taxed as ordinary income and generally subject to an additional 20 percent tax, unless an exception applies.
Historically, HSA participation was limited to individuals with high-deductible health insurance plans (HDHPs), which, for 2026, are defined as those with 1) a minimum deductible of $1,700 for self-only coverage, or $3,400 for family coverage, and 2) a maximum out-of-pocket expense limit (including deductibles and co-payments) of $8,500 for self-only coverage, or $17,000 for family coverage.
Effective Jan. 1, 2026, HSA eligibility also applies to individuals who purchase Bronze and Catastrophic individual coverage insurance plans through an exchange or on the individual market, regardless of the plan’s annual deductible or out-of-pocket expense limit. Generally, Bronze plans feature the lowest monthly premiums but higher out-of-pocket costs for care. By contrast, Catastrophic plans, which are generally limited to people younger than 30 or people age 30 or older who qualify for a hardship or other affordability exemptions, have low monthly premiums but the highest out-of-pocket costs.
Beginning in 2026, the OBBBA also generally expands HSA eligibility to include taxpayers who are covered under an HDHP and pay primary care doctors fixed, periodic membership-type fees for concierge healthcare services under a qualifying direct primary care service arrangement (DPCSA). These arrangements, which do not involve co-pays or insurance billing for office visits, physical exams, certain laboratory tests and urgent care, were previously treated by the IRS as “other coverage” that disqualified individuals with HDHPs from contributing to HSAs.
During the pandemic, Congress temporarily allowed HDHPs to cover telehealth and remote care services before the deductible was met without jeopardizing HSA eligibility. Without another extension, the provisions were scheduled to expire. The OBBBA made permanent the telehealth and remote-care safe harbor that permits HDHPs to cover qualifying telehealth and other remote-care services before the deductible is met without causing participants to lose HSA eligibility, effective retroactively for plan years beginning after Dec. 31, 2024.
As a reminder, the 2026 annual limits on HSA contributions are $4,400 for individual coverage and $8,750 for family coverage. Eligible individuals ages 55 or older may qualify to make additional catch-up contributions of $1,000.
About the Author: Anthony Gutierrez, CPA, is a principal with the Tax Compliance and Consulting practice of Baker Tilly x Berkowitz Pollack Brant, where he focuses on tax and estate planning for high-net-worth individuals, family offices, and closely held businesses in the U.S. and abroad. He can be reached at the CPA firm’s Miami office at (305) 379-7000 or info@bpbcpa.com.
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