IRS provides guidance on health savings account changes per OBBBA
Posted by DaveMoll on Dec. 11, 2025 / Subscribe 0
The IRS has issued guidance on changes relating to health savings accounts (HSAs) enacted by the One Big Beautiful Bill Act (OBBBA). These changes generally expand the availability of HSAs under Code Sec. 223. IRS Notice 2026-05 provides questions and answers that address the changes.
OBBBA changes. The OBBA made a few key changes to high-deductible health plans (HDHP) and, by extension, HSAs. First, it made permanent a safe harbor for HDHPs that have no deductible for telehealth and other remote care services. The OBBBA permanent extension applies retroactively after December 31, 2024.
Second, the term HDHP now includes any plan under the Patient Protection and Affordable Care Act (ACA) that is available as individual coverage through an exchange, including bronze and catastrophic plans. This provision amending the definition of an HDHP applies for months after December 31, 2025.
Third, direct primary care service arrangements (DPCSA) under Code Sec. 223(c)(1)(E)(ii)are no longer treated as a health plan for purposes of determining HSA eligibility and enrollment, and enrolling in a DPCSA will not cause a taxpayer to fail eligibility to contribute to an HSA. These DPCSAs changes would apply after December 31, 2025.
Telehealth. The notice indicates that a plan will not fail to be an HDHP solely because it offers telehealth benefits without a deductible for a service that is included on the list of telehealth services payable by Medicare that is published annually by the Department of Health and Human Services. For services that are not included on the HHS list, HSA participants should apply the principles of 42 U.S.C.1834(m), its implementing regulations at 42 C.F.R. 410.78, and other guidance issued by HHS defining telehealth services and related terms.
In addition, telehealth or other remote care services do not extend to in-person services, medical equipment, or drugs furnished in connection with those services unless they would otherwise be treated as telehealth services per HHS guidance.
Bronze plans. Regarding Exchange plans, a bronze or catastrophic plan will be treated as an HDHP if the plan is available as individual coverage through an Exchange established under ACA Sec. 1311 or 1321 even if the plan does not satisfy the minimum annual deductible requirement or maximum out-of-pocket expenses requirement for an HDHP under Code Sec. 223(c)(2)(A)(i) and (ii).
The notice also indicates that a bronze or catastrophic plan that is available as individual coverage will not fail to be an HDHP because an employer-sponsored ICHRA is used to purchase the coverage.
In addition, SHOP coverage that may be offered by a small employer is not individual coverage and therefore does not meet the criteria to be treated as an HDHP under Code Sec. 223(c)(2)(H). However, such a plan can still be an HDHP if it otherwise satisfies the applicable requirements, including the minimum annual deductible requirement and maximum out-of-pocket expenses requirement under Code Secs. 223(c)(2)(A)(i) and (ii).
DPCSA. The notice clarifies that the sole compensation for care provided under a DPCSA must be the fixed periodic fee. Thus, a DPCSA under section 223(c)(1)(E) does not include an arrangement that provides certain healthcare items and services to individuals on the condition that they are members in the arrangement and have paid a fixed periodic fee, but bills separately for those items and services (through insurance or otherwise).
Also, if an individual is enrolled in both a DPCSA and an HDHP, the HDHP is not permitted to count fees paid by the individual for the individual’s membership in the DPCSA toward the annual deductible and out-of-pocket maximum for the HDHP.
DPCSA fees can be reimbursed from an HSA before the coverage period for the arrangement, according to the notice. An HSA is permitted to treat an expense for a DPCSA as incurred on (1) the first day of each month of coverage on a pro rata basis, (2) the first day of the period of coverage, or (3) the date the fees are paid. Thus, for example, an HSA may immediately reimburse a substantiated fee for a DPCSA that begins on January 1 of that enrollment year, even if the enrolled individuals paid the fee prior to the first day of the enrollment year.
Comments. The IRS requests comments on all aspects of the notice. Written comments should be submitted on or before March 6, 2026. Comments may be submitted electronically via the Federal eRule making Portal at https://www.regulations.gov. Alternatively, comments may be submitted by mail to: Internal Revenue Service, CC:PA:01:PR (Notice 2026-5), Room 5503, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044.
SOURCE: IRS Notice 2026-05, I.R.B. 2026-02, January 5, 2026.
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