Open Enrollment Alert –
Direct Primary Care is now HSA-Compatible!
There is a BIG update on legislation related to Direct Primary Care (DPC). As of Jan. 1, 2026, new legislation (H.R. 1 aka the One Big Beautiful Bill) will officially allow Health Savings Account (HSA) funds to be used to pay for DPC memberships! Previously, HSA funds could only be used to pay for “incidental charges” at a DPC office – lab tests, medications, etc. Two of the three organizations that made rules about HSAs allowed HSA funds to be used to pay for the monthly membership as well as incidental charges, but perhaps the most important one, the IRS, did not. The IRS did not list DPC monthly memberships on the list of allowable medical expenses for HSA funds. Did that make sense? Absolutely not! I am so happy about this change as it can save money for folks who have an HSA (which means until Jan. 1, 2026, you have been enrolled in a high-deductible insurance plan and opened an HSA during that time).
Business owners will also benefit from this change. The new law will now allow both employers and employees to contribute to an HSA which can then be used to pay for a DPC monthly membership. This has beneficial tax implications for both employers and employees. Also, the number of plans that will allow an HSA to be established will expand (the ACA bronze plan is one addition). I am hopeful this law will apply to FSAs (Flexible Spending Accounts) and HRAs (Health Reimbursement Arrangements) as well, but the official word is TBD. How can a business owner benefit from including an option for DPC memberships for their employees? DPC provides easy access to care and a strong doctor-patient relationship, which means quality care for employees when they need it!
If you are a little lost as to what an HSA is, I won’t go into too much detail except to say that if you have a high-deductible health insurance plan (or other eligible plans as of Jan. 1, 2026), you should consider enrolling in an HSA. The money you put into an HSA is tax-free:
- The money isn’t taxed when you put it into an HSA
- The money isn’t taxed when you take money out of the HSA to pay for medical expenses
- You can invest the money in an HSA and allow it to grow tax-free
These three tax benefits can save you 10-37%, depending on what tax bracket your income puts you in.
The background story: Led by the DPC Coalition, DPC doctors have been fighting for a change to the HSA rules for approximately 15 years. Over the years, this topic has been discussed by various legislative committees, and this language even made it into a few bills that were never passed. Thanks to persistence and patience by those involved, the wording made it into HR 1. The DPC portion of the bill was briefly removed when the bill went from the House to the Senate, but then it was added back before the final vote. I’m just floored that this change has finally made it into law. My jaw hit the floor here in Columbia, South Carolina when I heard the news.
If you would like to watch a 3-minute explanation of the DPC language in HR 1, recorded by the DPC Alliance, which includes how using an HSA can save you money, CLICK HERE.
Happy Benefits Enrollment season!
P.S. Just to be clear, this blog is not a political statement of any kind 😊 I’m not making any comments on the rest of the language in the HR 1 law, just the page or two on DPC and HSAs!
Have a good week! Feel free to contact me with any questions.
Melissa Boylan, MD, FAAFP
Family Physician and Owner of Noreta Family Medicine
