Sponsors (3)
The bill makes more preventive items explicitly tax-free for HSA/Archer MSA users (helping chronic patients and reducing audit uncertainty) at the cost of locking in current guidance—reducing future flexibility—while creating some administrative burden and modest revenue loss.
HSA and Archer MSA account holders — including people with chronic conditions — can use tax-advantaged funds to pay for the preventive items listed in IRS Notice 2019-45, lowering out‑of‑pocket costs and providing clearer, statutory tax treatment that reduces audit uncertainty.
Taxpayers (and future policymakers) lose some regulatory flexibility because the statute locks in the Notice 2019-45 list, potentially preventing future IRS updates or broader interpretations of what preventive items qualify.
The Treasury/IRS and private stakeholders (financial institutions, hospitals, health systems) may face administrative and compliance complexity reconciling the new statutory treatment with prior or future guidance, raising implementation costs.
Making additional preventive items tax-free could modestly reduce federal tax revenues over time, with small fiscal impacts on the budget.
Based on analysis of 2 sections of legislative text.
Treats preventive services/items for chronic conditions listed in IRS Notice 2019–45 as having the same legal effect for HSA preventive‑care rules under IRC section 223(c)(2)(C).
Treats the preventive services and items for chronic conditions listed in IRS Notice 2019–45 as having the same legal effect for Health Savings Account (HSA) preventive-care rules under Internal Revenue Code section 223(c)(2)(C). Also includes a non‑substantive provision establishing the Act's short title; no new funding, programs, or deadlines are created.
Introduced February 4, 2025 by Vernon G. Buchanan · Last progress March 5, 2025