Congress has passed the "One Big Beautiful Bill Act (OBBB)" and President Donald Trump has signed it into law. The OBBB contains multiple changes to employee benefits law, including in the areas of HSAs, dependent care FSAs, student loan repayment assistance, and "Trump accounts."
OBBB HSA Expansion
Although the changes to health savings accounts (HSAs) are not as extensive as in the original House bill, the OBBB contains significant changes. First, the OBBB provides permanent relief which allows high-deductible health plans (HDHPs) to provide first-dollar telehealth and remote care services, whether or not these services are preventive in nature. The change, which originated during pandemic-related legislation, allows individuals to maintain eligibility for HSAs even if their HDHPs waive the deductible for telehealth and other forms of remote care. The OBBB makes this relief retroactive to all plan years starting after December 31, 2024, marking the expiration of last extension of the COVID-era relief.
Next, the OBBB categorizes all Bronze and Catastrophic level plans available through the Exchange as HDHPs. This classification opens access to HSAs for more people, as those plan options previously did not qualify as HDHPs, for various reasons.
Finally, as of 2026, the OBBB designates direct primary care (DPC) arrangements as compatible with HSAs. Previously, features of most DPCs disqualified individuals with those arrangements from HSA eligibility. However, eligible DPC fees must not exceed $150/month for an individual or $300/month for a family (both of which are indexed for inflation). The OBBB also classifies DPCs as a qualified medical expense for HSAs.
Increased Limits for Dependent Care FSAs
For plan years beginning on or after January 1, 2026, the OBBB increases the dependent care flexible spending account (FSA) limit to $7,500, or $3,750 for married couples filing separately. This limit is not indexed for inflation, but it is still notable since the dependent care FSA limit has not increased in the last 40 years.
Student Loan Repayment Assistance
Another form of COVID-era relief — tax-free student loan repayment by employers, which was scheduled to expire at the end of 2025— was made permanent by the OBBB. Employers can provide up to $5,250 per year under a §127 qualified educational assistance program. This limit on assistance is indexed for inflation starting in 2026, which will be the first adjustment to the limit since 1979.
Trump Accounts
The OBBB establishes so-called "Trump Accounts," which are designed to allow children to benefit from compound interest over time by investing in American industries. The annual contribution limit is $5,000 per child, and all children born from 2025 to 2028 will receive a $1,000 contribution from the federal government. The balances in these accounts, which will become available in 2026, will grow tax-deferred, similar to Individual Retirement Accounts (IRAs).
Employers also will be able to contribute up to $2,500 per year, indexed for inflation, to the Trump Accounts of their employees or their dependents.
Repeal of Tax-Free Bicycle Commuter Reimbursement Benefit
In 2017, the Tax Cuts and Jobs Act temporarily eliminated the $20 per month tax-free bicycle commuter reimbursement benefit for employers. Despite its demonstrably tiny impact on the federal budget, the OBBB permanently removed it, as it was slated to return in 2026.
Significant OBBB Omissions
Proposed HSA Provisions
The House draft of the OBBB made numerous significant efforts to expand HSAs, most of which did not survive the Senate or the reconciliation process. In its version of the bill, the House sought to incorporate the most recently proposed legislation concerning HSAs, including:
- Giving HSA eligibility to Medicare Part A enrollees;
- Limiting the use of HSAs for premium expenses at age 65 to individuals who are not eligible for HSAs;
- Allowing HSA funds to pay for limited services in on-site medical clinics and the cost of gym memberships or similar activities of up to $500 per year;
- Permitting both spouses aged 55 and older to make $1,000 catch-up contributions to the same HSA;
- Allowing distribution of funds from health FSAs or HRAs into HSAs for employees newly enrolled in HDHPs, subject to certain limits;
- Letting individuals use HSAs for expenses incurred in the 60 days after enrolling in an HDHP, as long as they establish an HSA during the same timeframe;
- Classifying individuals as HSA-eligible even if their spouses are enrolled in health FSAs; and
- Substantially increasing the HSA contribution limit with phase-outs for people with certain income levels.
Proposed ICHRA Provisions
In addition to HSA expansion, the House would have codified Individual Coverage HRAs (ICHRAs), which allow employers to provide employees with tax-free arrangements to cover individual market coverage. However, the final version of OBBB scrapped any mention of ICHRAs altogether, including the creation of an employer tax credit for offering an ICHRA.
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