On June 24, President Trump signed an executive order that, among other things, instructs various federal agencies to: 1) increase transparency in medical pricing and quality, 2) improve the ability of patients to control their own healthcare resources, including through FSAs and HSAs; and 3) protect patients from surprise medical bills.
Of particular interest to our clients are the proposed changes to HSAs and FSAs. While the executive order is, by nature, rather broad and vague, it instructs the Treasury Department to develop regulations to:
- Expand the types of high-deductible health plans that can be used with a health savings account. One possible change would be to allow such plans to cover low-cost preventive care, before the deductible, for care and treatment of chronic conditions.
- Increase the amount of funds that can be carried in a health FSA from one year to the next.
- Allow individuals to deduct the cost of certain non-insurance types of health care arrangements, such as direct primary care arrangements and healthcare sharing ministries.
The order reflects the ongoing desire of the administration to encourage various forms of consumer-driven healthcare as a way of controlling health costs and health insurance premiums. While it’s too soon to predict how far the agencies will go with such changes, it’s definitely something we will be keeping our eye on!