Guide

DPC fees and the HSA: what changed for months beginning in 2026

Summary

A patient with a health savings account can pay a direct primary care membership fee with HSA dollars for any month beginning after December 31, 2025, and that membership no longer disqualifies the patient from contributing, as long as the aggregate fee stays at or under $150 a month, or $300 where the arrangement covers more than one person. The patient still needs a qualifying high-deductible plan, and the IRS has published no guidance interpreting the change.

By Gale Editorial · Updated 2026-09-02. Every figure cited to a dated source. How we write.

Can a patient's HSA pay a direct primary care membership fee?

Yes, for any month beginning after December 31, 2025. The 2025 reconciliation law added a direct primary care service arrangement to the list of things an HSA distribution can pay for, and it separately kept a qualifying arrangement from counting as the coverage that disqualifies a patient from contributing 1. Both changes were enacted on July 4, 2025 as section 71308 of Public Law 119-21, and both apply to months rather than plan years 2.

The statute writes its own vocabulary. A direct primary care service arrangement is the phrase Congress used, and the monthly fee ceiling and the excluded services below are part of what that phrase means 1.

So the label on the door is not what gets read. Whether a membership is DPC or concierge, the safe harbor looks at the fee and at what the agreement covers 1.

The $150 and $300 ceilings, and the month a fee crosses them

The ceiling is $150 a month in aggregate fees for one individual, and twice that amount, $300, for an arrangement covering more than one person 1. It behaves as a cliff. A month whose aggregate fees run a dollar over that figure puts the arrangement outside the statutory definition for the month, and that is what exposes the patient to being treated as having disqualifying coverage 1.

Aggregate is the operative word. The cap is measured against all direct primary care service arrangements with respect to that individual for that month, so a second membership at another practice adds to the same number 1.

The two figures do not stay put either. The enacting law indexes both caps for inflation for taxable years beginning after 2026, off a calendar-year-2025 base, so a practice pricing at exactly $150 in 2026 is pricing against a ceiling that moves later, by an amount nobody can quote yet 2.

But the ceiling is a tax threshold, and it carries no opinion about what primary care is worth. Panel size and price are the other half of the DPC equation, and a practice that cuts its fee to sit under a federal figure has changed its revenue per member without changing what it costs to serve one.

What the membership has to leave out

The safe harbor reaches an arrangement limited to primary care services, and the statute names three things that fall outside that term: procedures requiring general anesthesia, prescription drugs other than vaccines, and laboratory services not typically administered in an ambulatory primary care setting 1. A membership that folds any of the three into the fee is a membership the definition does not reach.

Many practices already price dispensing and send-out labs separately, and the statute gives that habit a tax reason. What carries the weight is the list of included services in the direct agreement, which is where those three exclusions have to be answered.

None of this bars a practice from doing any of it. A practice can dispense, draw its own labs and charge for both. The statutory question is narrower: what the monthly fee covers 1.

The carve-out does not create HSA eligibility on its own

A patient still needs a qualifying high-deductible health plan and contribution room before any of this matters. For calendar year 2026 that plan carries an annual deductible of at least $1,700 for self-only coverage or $3,400 for family coverage, with annual out-of-pocket expenses capped at $8,500 and $17,000, and the annual contribution limit is $4,400 self-only and $8,750 family 3.

2026 figureSelf-onlyFamily
Minimum HDHP deductible$1,700$3,400
Maximum out-of-pocket$8,500$17,000
HSA contribution limit$4,400$8,750

Twelve months at the $150 ceiling comes to $1,800, a little over 40 percent of the self-only contribution limit and roughly a fifth of the family limit 3. That is the arithmetic a member is deciding about, and it sits alongside a deductible they are funding out of the same account.

Pricing the tiers against that account is a different exercise from pricing them against the federal ceiling. A household on family coverage draws one account down for every membership it buys, and the aggregate cap and the contribution limit both bite in the same month.

What the IRS has not said yet

No IRS guidance interprets the provision. The current edition of Publication 969, the agency's own HSA guide, does not mention direct primary care anywhere 4, and the Form 8889 instructions, the form on which HSA contributions and distributions are reported, carry no direct primary care line or worksheet 5. A 2026 distribution for a membership fee is reported under the form's general qualified-medical-expense rules 5.

Two questions sit inside the aggregation rule with nothing official on top of them. How the cap is computed when a patient holds memberships at two practices in the same month has no published interpretation, and neither does the phrase that doubles the cap, an arrangement covering more than one individual, which is not the wording a practice uses when it sells a family tier 4.

Something else did not change at all. The 2025 amendment sits inside the HSA statute, and Publication 502's general definition of deductible medical care was not amended to add direct primary care 6, so this provision does not turn a membership fee into an itemized medical deduction for a patient who holds no HSA.

But that is an answer about this law only, and what any individual patient can deduct is a question for their own return and their own preparer.

The state rail runs separately

The $150 ceiling is federal and uniform, and it says nothing about whether a practice may run a direct-fee model in its own state. Those rules live in state insurance codes. Washington, for one, administers its exemption through an affirmative step: a practice that charges a monthly fee, offers only primary care and does not bill insurance registers with the state Office of the Insurance Commissioner and renews that registration annually 7.

That is Washington's rule and only Washington's. The lookup is the same everywhere: search the state insurance code for direct primary care or medical retainer agreements, then read the insurance commissioner's own site for a registration or filing step, because the chapter that exempts direct practices from insurance regulation is generally the chapter that says what an exempt practice owes.

The federal definition and the state one answer different questions. What the tax code reads is the fee and the covered services 1; what the state reads is whether the arrangement is insurance.

What to change before the first 2026 renewal

Read the fee schedule and the membership agreement against three things: the aggregate monthly fee for one individual, the figure that applies when the arrangement covers more than one, and the list of what the fee includes. Then decide whether the practice wants to sit under the ceiling at all. A practice priced above it is doing nothing wrong and is simply outside a tax convenience some of its members will ask about 1.

  • Put the month and the amount on every receipt. A member paying from an HSA is documenting a qualified distribution, and the receipt is the record they hold.
  • Keep dispensing, general-anesthesia procedures and send-out labs on their own lines, outside the membership fee, if the arrangement is meant to sit inside the statutory definition 1.
  • State the effective date in enrollment materials. Nothing about a 2025 fee changed, and the provision applies to months beginning after December 31, 2025 1.
  • Answer the tax question with the citation and stop there. A practice can give a member the section number, the fee, and the months it covered; how to report a distribution is between that member and their preparer.

Publication 969 and the Form 8889 instructions are revised every year, and an update to either is the first place a practice would see the IRS read this 45.

Common questions

Yes, for months beginning after December 31, 2025. The 2025 law did two separate things: it added a direct primary care service arrangement to the expenses an HSA distribution can pay, and it kept a qualifying arrangement from being treated as coverage that blocks HSA eligibility. Both sit in the HSA statute itself, and neither reaches a fee paid in 2025.

The threshold is a cliff. For any month in which aggregate fees for that individual exceed $150, or $300 where the arrangement covers more than one person, the arrangement falls outside the statutory definition, and the patient is exposed to being treated as having disqualifying coverage that month. Nothing stops a practice from pricing above the figure; what is at stake is the member's eligibility.

The statute counts aggregate fees for all direct primary care service arrangements with respect to that individual for the month, so more than one membership adds to a single number. How that computation runs in practice has no IRS interpretation yet, since the agency's HSA guide does not mention direct primary care at all. Asking at enrollment is the only way a practice learns of the other arrangement.

The statute doubles the amount for an arrangement covering more than one individual. The clause counts individuals; the word family is not in it. No published guidance maps that phrasing onto the family tier a practice sells, which can cover two adults, an adult and a child, or a whole household. Read the agreement's covered-persons language against the statute's wording rather than against the tier name.

Not by this law. The 2025 change amended the health savings account statute only, and the general definition of deductible medical care in Publication 502 was not amended to add direct primary care. So a membership fee is not made an itemized medical deduction by the carve-out. What an individual patient can deduct on a return is a question for that patient's own preparer.

Yes. The carve-out removes an obstacle to eligibility; it does not create eligibility. For 2026 the plan has to carry an annual deductible of at least $1,700 self-only or $3,400 family, with out-of-pocket expenses capped at $8,500 and $17,000, and the year's contribution limits are $4,400 self-only and $8,750 family.

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References

  1. 1.Office of the Law Revision Counsel, U.S. House of Representatives (2025). 26 U.S.C. § 223 — Health savings accounts (subsection (c)(1)(E), Treatment of direct primary care service arrangements). United States Code (uscode.house.gov). link ✓The statutory definition of a direct primary care service arrangement, the $150 per individual and $300 multi-person monthly aggregate fee ceilings and their cliff behavior, the three excluded service categories, the rule letting an HSA distribution pay the fee itself, and the effective date for months beginning after December 31, 2025.
  2. 2.119th Congress (2025). Public Law 119-21 -- An Act To provide for reconciliation pursuant to title II of H. Con. Res. 14 (Sec. 71308, Treatment of Direct Primary Care Service Arrangements). U.S. Statutes at Large, 139 Stat. 326-327 (via congress.gov). link ✓The enacting law and its July 4, 2025 date, the provision's application to months beginning after December 31, 2025, and the inflation indexing of both dollar caps for taxable years beginning after 2026 off a calendar-year-2025 base.
  3. 3.Internal Revenue Service, U.S. Department of the Treasury (2025). Rev. Proc. 2025-19. Internal Revenue Bulletin (irs.gov/pub/irs-drop). link ✓The calendar-year-2026 HDHP minimum deductibles and out-of-pocket maximums and the 2026 HSA contribution limits a patient must already satisfy before the direct primary care carve-out is relevant.
  4. 4.Internal Revenue Service (2025). Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans. IRS.gov. link ✓That the current edition of the IRS's own HSA guide does not mention direct primary care, so no IRS interpretive guidance on the carve-out or on fee aggregation exists yet.
  5. 5.Internal Revenue Service (2025). Instructions for Form 8889 (2025), Health Savings Accounts (HSAs). IRS.gov. link ✓That the current Form 8889 instructions carry no direct primary care line or worksheet, so a 2026 distribution for a membership fee is reported under the form's general qualified-medical-expense rules.
  6. 6.Internal Revenue Service (2025). Publication 502, Medical and Dental Expenses. IRS.gov. link ✓That the 2025 change amended the HSA statute only and did not add direct primary care to the general medical-expense definition used for itemized deductions.
  7. 7.Washington State Office of the Insurance Commissioner (2026). Direct primary care practices. insurance.wa.gov (Washington OIC). link ✓Washington's requirement that a qualifying direct practice, one charging a monthly fee, offering only primary care and not billing insurance, register with the Office of the Insurance Commissioner and renew annually, used as one state's example of a rail separate from the federal tax ceiling.

https://www.gale.care/for-providers/se-dpc-hsa-hdhp-2026 · 7 sources. Competitor details are cited to dated public sources and maintained as they change; figures are estimates, not commitments. Synthetic demonstration.

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