Health Savings Account Expansion Act

Subparagraph (A) of section 223(c)(1) of the Internal Revenue Code of 1986 is amended—

(1) by striking if— and inserting if, as of the 1st day of such month—

(2) by striking as of the 1st day of such month in clause (i),

(3) by redesignating subclauses (I) and (II) of clause (ii) as items (aa) and (bb), respectively, and by moving such items 2 ems to the right,

(4) by redesignating clause (ii) as subclause (II) and by moving such subclause 2 ems to the right,

(5) by striking such individual in subclause (II), as so redesignated,

(6) by striking such individual is covered in clause (i) and inserting “such individual—,

(I) is covered

(7) by striking the period at the end and inserting, or, and

(8) by adding at the end the following new clause:

(ii) such individual—

(I) is covered under a government plan, including coverage under the Medicare program under part A, part B, or part C of title XVIII of the Social Security Act, the Medicaid program under title XIX of such Act, the CHIP program under title XXI of such Act or a qualified CHIP look-alike program (as defined in section 2107(g) of such Act), or coverage under chapter 89 of title 5, United States Code, or

(II) is a participant in a health care sharing ministry (as defined in section 5000A(d)(2)(B)(ii) without regard to subclause (IV) thereof).

(1) Section 223(c)(1)(B) of the Internal Revenue Code of 1986 is amended by striking (A)(ii) and inserting (A)(i)(II).

(2) Section 223(c)(1)(E)(i) of such Code is amended by striking (A)(ii) and inserting (A)(i)(II).

The amendments made by this section shall apply to taxable years beginning after December 31, 2026.

Paragraph (2) of section 223(c) of the Internal Revenue Code of 1986 is amended—

(1) by striking clause (ii),

(2) by striking a health plan— and all that follows through which has an annual deductible and inserting a health plan which has an annual deductible, and

(3) by redesignating subclauses (I) and (II) as clauses (i) and (ii), respectively, and by moving such clauses 2 ems to the left.

(1) Paragraph (2) of section 223(c) of the Internal Revenue Code of 1986 is amended by striking subparagraphs (B) and (D) and by redesignating subparagraphs (C), (E), (F), (G), and (H) as subparagraphs (B), (C), (D), (E), and (F), respectively.

(2) Subparagraph (D) of section 223(c)(2) of such Code, as so redesignated, is amended by striking paragraph (2)(A)(i) and inserting subparagraph (A).

The amendments made by this section shall apply to taxable years beginning after December 31, 2026.

Paragraph (2) of section 223(d) of the Internal Revenue Code of 1986 is amended—

(1) by striking subparagraph (B),

(2) by redesignating subparagraphs (C) and (D) as subparagraphs (B) and (C), respectively,

(3) by striking Subparagraph (B) shall not apply to any expense in subparagraph (B), as so redesignated, and inserting Subparagraph (A) shall not apply to any payment for insurance other than, and

(4) in subparagraph (B), as so redesignated—

(A) by striking or at the end of clause (iv),

(B) by striking the period at the end of clause (v) and inserting, or, and

(C) by adding at the end the following new clause:

(vi) a health plan or health insurance coverage described in subsection (c)(1)(A).

Paragraph (2) of section 223(d) of the Internal Revenue Code of 1986, as amended by subsection (a), is further amended by adding at the end the following new subparagraph:

The term qualified medical expenses shall include—

(i) periodic fees paid to a physician for a defined set of medical services or for the right to receive medical services on an as-needed basis, and

(ii) amounts prepaid for medical services designed to screen for, diagnose, cure, mitigate, treat, or prevent disease and promote wellness.

The amendments made by this section shall apply to taxable years beginning after December 31, 2026.

Subsection (c) of section 223 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

A health care sharing ministry (as defined in section 5000A(d)(2)(B)(ii) without regard to subclause (IV) thereof) shall not be treated as a health plan or insurance for purposes of this title.

The amendments made by this section shall apply to taxable years beginning after December 31, 2026.

Section 213(d) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

Amounts paid for the following expenses with respect to a health care sharing ministry (as defined in section 5000A(d)(2)(B)(ii) without regard to subclause (IV) thereof) shall be treated as amounts paid for medical care:

(A) Membership fees for such health care sharing ministry.

(B) The sharing of medical expenses among members.

(C) Administrative fees of the ministry.

The amendment made by this section shall apply to taxable years beginning after December 31, 2026.

Subparagraph (A) of section 223(d)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following: Such term shall include an amount paid for medicine or a drug only if such medicine or drug is a prescribed drug (determined without regard to whether such drug is available without a prescription) or is insulin..

Paragraph (2) of section 223(d) of such Code is amended by striking subparagraph (C) and by redesignating subparagraphs (D) and (E) as subparagraphs (C) and (D), respectively.

Section 220(d)(2)(A) of the Internal Revenue Code of 1986 is amended by adding at the end the following: Such term shall include an amount paid for medicine or a drug only if such medicine or drug is a prescribed drug (determined without regard to whether such drug is available without a prescription) or is insulin..

The amendments made by this section shall apply to taxable years beginning after December 31, 2026.