Details of Public Law 119-21, section 71307 , One Big Beautiful Bill Act

Under federal law, eligible individuals may establish a Health Savings Account (HSA), which provides tax-favored treatment for current medical expenses, as well as the ability to save on a tax-favored basis for future medical expenses. Generally, individuals are eligible to establish an HSA when they are covered by a high-deductible health plan and have no other health coverage (with the exception of plans providing certain permitted benefits/coverage).

Federal law, under the Affordable Care Act (Public Law 111-148, Section 1302), provided categories of plans with set employer and employee shared costs. The plans include the following levels, bronze, silver, gold, or platinum, and catastrophic. A bronze plan requires that employers provide a level of benefit coverage at 60% with the employee paying the remainder. A catastrophic plan is available when no other plans are made available and the employee is under 30 years old with income hardships.

This provision would allow bronze and catastrophic level plans to be classified as high-deductible health plans for purposes of establishing HSAs, for months beginning after December 31, 2025.

California specifically does not conform to federal HSAs and does not conform to the Bronze and Catastrophic level plans classification as high-deductible health plans. As a result, California does not conform to the changes made by this provision.