Sponsors (3)
This is not an official government website.
Copyright © 2026 PLEJ LC. All rights reserved.
Allows certain wearable health devices and related software/subscriptions to be treated as qualified medical expenses for HSAs, Archer MSAs, FSAs, and HRAs, subject to a $375 annual cap. The bill defines "wearable device" to cover body-worn devices or software that collect/analyze physiological data for diagnosis, prevention, treatment, or that assist in diagnosis or treatment. The change is added to the Internal Revenue Code and takes effect for amounts paid or expenses incurred after December 31, 2025 (i.e., beginning January 1, 2026). The $375 limit applies per taxable year and is the maximum amount of wearable-device expenses that can be treated as qualified medical expenses under those accounts.
The bill makes diagnostic and management wearables partially more affordable and clarifies tax treatment for employers and consumers, but the modest $375 cap and reliance on tax‑advantaged accounts limit reach and may amplify access and administrative equity issues.
People with HSAs, FSAs, HRAs, or Archer MSAs can pay up to $375/year pre-tax for diagnostic or health‑management wearable devices, lowering their after‑tax cost for these tools.
Patients with chronic conditions gain more affordable access to diagnostic and monitoring wearables that can help manage their health.
Employers and plan administrators can reimburse wearable expenses and have clearer tax-code guidance on qualifying digital health tools, expanding employer benefit options and reducing ambiguity for administrators and consumers.
Most people will still face significant out-of-pocket costs because the tax-advantaged reimbursement is capped at $375 per year, which may not cover many devices or necessary subscriptions.
The benefit primarily helps those with employer plans or tax‑advantaged accounts, leaving uninsured and low‑income people with little or no access and widening disparities in access to digital health tools.
Employers and plan administrators may face additional administrative complexity to determine which devices qualify and to track individuals' $375 limits.
Introduced June 26, 2025 by David Schweikert · Last progress June 26, 2025