We have some updates regarding health and dependent care benefits, as a result of the One, Big, Beautiful Bill Act (OBBBA) signed into law on July 4, 2025. These changes are designed to give participants more flexibility, savings, and access to care. Here is a summary of the key provisions affecting HSAs and FSAs.
Health Savings Accounts (HSAs)
1. Expanded Eligibility (Effective January 1, 2026):
- Bronze and Catastrophic ACA Plans are now HSA-qualified HDHPs.
- Direct Primary Care (DPC) Arrangements are eligible if monthly fees are ≤ $150 (individual) or ≤ $300 (family), adjusted annually for inflation.
2. Telehealth Services (Retroactive to Plan Years Starting After December 31, 2024):
- Permanent safe harbor for HDHPs to cover telehealth services before deductible is met.
3. HSA Funds Usage:
- Tax-free use of HSA funds for DPC fees within cost limits.
Dependent Care Flexible Spending Accounts (FSAs)
1. Increased Contribution Limits (Effective January 1, 2026):
- $7,500 for single filers or married filing jointly.
- $3,750 for married filing separately.
- Limits are not indexed for inflation.
2. Nondiscrimination Testing:
- Rules remain unchanged; employers must ensure compliance.
Summary of Effective Dates
| Provision | Effective Date |
| HSA eligibility for Bronze/Catastrophic plans | January 1, 2026 |
| HSA eligibility with DPC arrangements | January 1, 2026 |
| HSA use for DPC fees | January 1, 2026 |
| Permanent telehealth safe harbor for HDHPs | Plan years after Dec 31, 2024 |
| Increased Dependent Care FSA limits | January 1, 2026 |
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