HSA 2026: Bronze Plans, Direct Primary Care, Form 8889

What changed, and from which date

Public Law 119-21 (July 4, 2025), the law commonly called the One, Big, Beautiful Bill Act, made three changes to Section 223 that Notice 2026-5 explains in question and answer form. The dates differ, and mixing them up is the most common error in the summaries we read.

Source: IRS Notice 2026-5, section II.B and section III; 26 U.S.C. 223 (Cornell LII), read on October 29, 2026.

Before the 2025 law amended 26 U.S.C. § 223(c)(2)(H), Notice 2026-5 says, “many bronze plans did not qualify as HDHPs because the plans' out-of-pocket maximum exceeded the statutory limits for HDHPs or because they provided benefits that were not preventive care without a deductible.” Catastrophic plans “could not be HDHPs” because they had to cover three primary care visits before the deductible and had an out-of-pocket maximum above the HDHP limit. The 2025 law removes those tests for these two plan types only (26 U.S.C. § 223(c)(2)(H); Notice 2026-5, answer 4).

The old tests still apply to every other plan. A silver or gold plan, or an employer plan, must still meet the minimum deductible and the out-of-pocket cap in the table below.

Which bronze and catastrophic plans count

The Notice answers ten questions on this. The answers a buyer needs are in the table.

Source: IRS Notice 2026-5, section III.B, read on October 29, 2026.

Two points the Notice itself flags. An ICHRA that reimburses only premiums does not disqualify the HSA, but “generally, an HRA (including an ICHRA) is permitted to reimburse only premiums” for the person to stay eligible (answer 5). And a plan is treated as an HDHP by name, not by what it covers: footnote 5 says “Bronze plans are treated as HDHPs under section 223 regardless of which services they cover before the deductible.”

The catastrophic plan is narrower than the bronze plan. It is “a health plan solely offered in the individual market”, and enrollment is limited to people who have not turned 30 before the plan year or who are exempt from the individual mandate because of no affordable coverage or a hardship. A 45-year-old without a hardship exemption cannot buy one, so for most readers the live question is bronze.

We have not read any insurer's 2026 or 2027 bronze plan documents: the plan's deductible and out-of-pocket maximum come from its Summary of Benefits, not from the IRS. Under the Notice a qualifying bronze plan does not have to meet the HSA numbers, so the test is how the plan is classified and sold, not what it charges.

Direct primary care: the $150 and $300 test

A direct primary care service arrangement, or DPCSA, is a membership in which a primary care practitioner treats you for a fixed periodic fee. Before 2026 the IRS view, restated in the Notice, was that such an arrangement “generally would constitute a health plan that provides coverage before the minimum annual deductible is satisfied,” so an HSA owner who joined one could not contribute. Section 223(c)(1)(E) now says the arrangement “shall not be treated as a health plan” for that test, subject to the conditions below.

Source: 26 U.S.C. 223(c)(1)(E); IRS Notice 2026-5; Rev. Proc. 2026-24, read on October 29, 2026.

The sections of the Notice that decide edge cases:

• The terms decide, not your use. If an arrangement includes services beyond primary care, declining to use them does not fix it (answer 14).
• A practice that also bills non-members separately for services is still a DPCSA, as long as members pay only the fixed fee (answer 12).
• An HDHP cannot pay your DPC membership before its deductible (answer 15), and the fee you pay does not count toward your HDHP deductible or out-of-pocket maximum (answer 16).
• Past the cap, “fees for a DPCSA that do not satisfy the monthly dollar limit” can still be paid from the HSA as a medical expense, but you cannot contribute while enrolled (answer 20). The cap therefore works as an eligibility switch, not a spending limit.
• Your own HSA can reimburse a DPC fee as of the first of each month, the first day of the coverage period or the date paid. Fees paid by an employer or through a cafeteria plan cannot be reimbursed again from the HSA (answers 18 and 19).

The statute says the $150 and $300 amounts are indexed for inflation after 2026, but Rev. Proc. 2026-24 states them as $150 and $300 for 2027. Summaries that say the cap rises in 2027 are not supported by the revenue procedure as published.

Worked example: the cap test (our arithmetic)

A self-employed 58-year-old pays a DPC practice $149 a month, which is $1,788 for a year. That is under the $150 cap, so the membership is not a health plan and, with a qualifying plan, the person stays eligible. If the practice raises the fee to $151 a month, the annual cost is $1,812, the arrangement is over the cap, and contributions stop for each month of enrollment, even though the HSA can still pay the $151.

Telehealth, and the 2025 rule that came back

Section 223(c)(2)(E) lets a plan skip the deductible for “telehealth and other remote care services.” The CARES Act first allowed this in 2020 on a temporary basis, and Congress extended it until taxable years beginning before January 1, 2025. The 2025 law made it permanent retroactively, for plan years beginning after December 31, 2024. Notice 2026-5 answers three questions:

• Contributions for 2025 were allowed whether made before or after July 4, 2025 if the plan covered telehealth before the deductible and otherwise met the HDHP tests (answer 1).
• Telehealth means services on the Medicare telehealth list published under Social Security Act section 1834(m)(4)(F); for others apply 42 CFR 410.78 principles (answer 2).
• In-person services, equipment and drugs furnished with a telehealth visit are not covered by the safe harbor (answer 3).

The limits, 2025 to 2027

Source: IRS Notice 2026-5 (2025 and 2026 amounts, footnote 1; Rev. Proc. 2025-19 is its cited source for 2026); Rev. Proc. 2026-24, section 3.01 (2027); 26 U.S.C. 223(b)(3) for the $1,000. Read on October 29, 2026.

The 2027 limit is $100 higher for self-only and $250 higher for family than 2026 (our arithmetic). The limits apply equally to a bronze plan holder: the new law changes who is eligible, not how much they may contribute. A person aged 55 or older with self-only coverage has $5,500 for 2027, and a couple on family coverage who both are 55 or older can hold $10,000 across two accounts if each adds the $1,000 to a separate HSA (our arithmetic; Publication 969 puts each spouse's catch-up in that spouse's own account).

Contributions for 2026 can be made until the due date of the 2026 return, and the Medicare-timing rules for people near 65 are on our HSA and Medicare page.

Worked example: the last-month rule when you switch to a qualifying plan (our arithmetic)

Section 223(b)(8) lets a person who is eligible on the first day of the last month of the year (December 1 for most) contribute as if eligible all year, with a testing period (the Form 8889 instructions: from December 1 through December 31 of the next year). Suppose a 45-year-old with self-only coverage is enrolled in a qualifying plan on December 1, 2026:

• The 2026 limit under the last-month rule is $4,400.
• If the person stops being eligible after one month of 2027, one month of eligibility is worth $4,400 / 12 = $366.67.
• The amount that would not have been allowed without the rule, $4,400 - $366.67 = $4,033.33, is included in 2027 income, plus a 10 percent additional tax of $403.33 (Form 8889 lines 18 and 21).

How the 2026 forms work (Form 8889 line map)

We read the 2025 Form 8889 and its instructions; no 2026 edition was on irs.gov on October 29, 2026, so the line numbers below may change when it is published. The new rules do not add a line on the 2025 form, because they apply from 2026.

Source: Form 8889 (2025) and Instructions for Form 8889 (2025), read on October 29, 2026. The list shows the lines relevant to this page, not every line.

Three practical points from the instructions. Payroll deductions through a cafeteria plan are not on line 2; they appear in box 12 code W and go on line 9. Contributions you make yourself, as a self-employed person or from a bronze plan bought on an Exchange, are on line 2 and deducted on line 13, an adjustment to income. And excess contributions are figured from line 2 and line 13 and taxed on Form 5329.

Because the HSA deduction is subtracted in arriving at adjusted gross income, and the premium tax credit's household income starts from adjusted gross income (26 U.S.C. 36B(d)(2)(B)), a deductible contribution lowers the income used for the credit (our reading of both texts). Contributions made through a payroll cafeteria plan never reach wages, which has the same effect. How much that matters depends on where you sit against the subsidy limit; the thresholds and what counts are on our ACA subsidy cliff page.

The HSA as a retirement account

The rules that make an HSA work as a long-term account, from Publication 969 and Section 223:

Source: IRS Publication 969 (2025), read on October 29, 2026; 26 U.S.C. 223 (Cornell LII).

Worked example: receipts you keep (our arithmetic)

A person pays $1,500 a year of qualified medical costs out of pocket from the year after opening an HSA and keeps receipts. After 10 years the receipts total $15,000. If the documents are read as the table above does, the HSA can later pay the person back $15,000 tax-free for those costs, without regard to the year they were incurred. Taking $15,000 for a non-medical purpose before 65 instead would add 20 percent, $3,000 (15,000 x 20%), on top of income tax. This is arithmetic on the rules above, not a prediction of any balance, and a tax preparer should confirm the reimbursement timing for your facts and your state, which may tax HSAs differently; we did not read any state rules.

For what an HSA does and does not pay once you are on Medicare, see our HSA and Medicare page, and for the long-term care premium limits our hybrid long-term care tax page.

What a reader can do with this

• Read the plan's Summary of Benefits against two tests. For a bronze or catastrophic plan, confirm it is sold as individual coverage on an Exchange (or the same plan is). For any other plan, check the deductible and out-of-pocket numbers against the 2026 or 2027 column above.
• Ask a direct primary care practice for the fee in writing, and whether it bills members for anything else. The test is a fixed fee of $150 a month or less for one person, with no separate billing to members.
• Do not let an employer or cafeteria plan pay the DPC fee if you want the HSA to reimburse it. Notice 2026-5 answer 18 treats that as an employer payment.
• Check the month, not the year. Eligibility is tested by month, and contributions are prorated unless the last-month rule applies, with its 12-month testing period.
• Keep receipts and a ledger if you plan to reimburse yourself later. Publication 969 requires records showing the expense was qualified, was not paid from another source and was not taken as an itemized deduction.
• File Form 8889 every year you or your employer contribute or you take a distribution, and expect line numbers to change when the 2026 form is published.

FAQ

Sources, read and saved on October 29, 2026: IRS Notice 2026-5 (Expanded Availability of Health Savings Accounts under the One, Big, Beautiful Bill Act); IRS Rev. Proc. 2026-24 (2027 HSA amounts); IRS Publication 969 (2025 returns); Form 8889 and Instructions for Form 8889 (2025); 26 U.S. Code Sections 223 and 36B (Cornell Legal Information Institute). The worked examples and the arithmetic are ours. This is analysis of public documents, not investment, legal or tax advice.