The House has spoken and Health Savings Accounts (HSAs) are getting an upgrade.

The “One Big, Beautiful Bill,” recently passed by the House, includes a list of HSA-related provisions designed to expand eligibility, increase flexibility and boost tax-advantaged savings potential. These are the first significant changes in almost two decades – since President George W. Bush signed the Tax Relief and Health Care Act of 2006 into law.

Like all legislation, the bill is a mix of incentives and potential issues. Employers need to look closely and, should the legislation become law, adjust coverage, and inform and educate employees.

aequum supports thoughtful expansion of HSA access while remaining committed to preserving the features that make HSAs effective today. Here’s a look at what may change, how it could impact employer-sponsored plans and what steps to consider in advance of the new rules.

What’s in the Bill: Expanded Eligibility and Access

Under current law, HSA eligibility is limited to individuals enrolled in what the statute calls a high-deductible health plan (HDHP) so long as they don’t also have “disqualifying coverage”. Disqualifying coverage includes Medicare Part A, general-purpose FSAs and certain on-site clinic services. That’s about to change.

Key expansions include:

• Medicare Part A access: Individuals who are otherwise eligible for HSA-capable coverage, and who are eligible and enroll in Medicare Part A based on age would now be eligible to contribute to an has – reversing a previous rule that cut off contributions even for actively working seniors.
• Bronze and Catastrophic Plan eligibility: Marketplace plans that previously disqualified HSA contributions will now be considered HSA-capable.
• Direct Primary Care (DPC) inclusion: Individuals with a DPC membership (up to $150/month) would remain HSA-eligible and DPC fees would be reimbursable.
• On-site clinics: Accessing limited services from on-site employer would no longer disqualify individuals from contributing to a HSA.
• Spousal FSA access: A worker can now be HSA-eligible even if their spouse is enrolled in a general-purpose FSA.

Together, these changes could bring many Americans into the HSA-eligible population, including retirees, independent contractors, small business employees and individuals priced out of traditional group coverage.

Added Flexibility for Savers

In addition to expanding who can participate, the bill also enhances how HSA funds can be contributed and used:

• Shared catch-up contributions: Both spouses can now make the $1,000 “age 55+” catch-up to the same HSA account.
• Transition relief: Workers moving from an FSA or HRA into an HDHP can roll over funds.
• Pre-enrollment medical expenses: HSA dollars can now reimburse expenses incurred up to 60 days before the HSA was officially opened.
• Fitness reimbursement: Up to $500 (individual) or $1,000 (family) per year in fitness and exercise costs can be covered tax-free.

For employers, this means more flexible plan designs and the opportunity to align benefit strategy with wellness, retirement and tax efficiency goals.

The Catch: New “Pay-Fors” Could Undermine HSA Value

While most of these changes are employer-friendly, not all are without tradeoffs. To pay for the expanded benefits, lawmakers have floated proposals that would erode one of the most powerful uses of an HSA, penalty-free withdrawals for non-medical purposes after age 65.

Currently, retirees can tap into their HSA funds for any reason, even non-medical, without paying the 20% penalty (though income tax still applies). That’s what makes HSAs even more attractive than 401(k)s for long-term savings.

One earlier “pay-for” provision would have reversed this, reimposing the 20% penalty after age 65 unless funds were used strictly for medical expenses. The proposal once limited that to all age 65+ but may have been modified only to apply to those otherwise eligible to contribute to a Health Savings Account. Regardless, this type of “pay for”, particularly if expanded to apply to all over age 65, could reduce the utility of HSAs and potentially penalize decades of smart savings.

What Employers Should Do Now

Whether or not all provisions survive the final reconciliation process, it’s clear the rules of HSA engagement are shifting and employers with calendar-year plans must be ready to act by December 1, 2025.

aequum recommends plan sponsors:

• Audit current plan designs for HSA eligibility restrictions (e.g., on-site clinics, spouse FSAs, Medicare-aged workers).
• Evaluate has-capable coverage offerings to align with expanded eligibility (especially Bronze and Catastrophic plans).
• Prepare communication strategies to educate employees about new contribution and reimbursement rules.
• Partner with a legal and compliance team, including aequum, to assess how new rules affect fiduciary obligations under ERISA.

Final Word: Expansion With Eyes Wide Open

HSAs are among the most powerful tools employers have to reduce healthcare costs and improve financial wellness. The One Big Beautiful Bill is a step toward broader access but that access should not come at the expense of long-term value.

aequum helps employers protect their health plans from unnecessary costs, compliance risk and structural threats, whether those come from unregulated pricing or shifting tax policy. Our health coverage professionals are HSA design and compliance experts.

Contact us today to understand how the proposed HSA changes affect your plan and how to prepare for what’s next.