New health savings account creates tax break—but only for the insured and employed

What it does

This bill creates a new tax-advantaged savings account called a HOPE Account (Health Out-of-Pocket Expense Account) that allows individuals to set aside pre-tax money to pay for qualified medical expenses. Eligible individuals can contribute up to $4,000 per year (or $8,000 for family coverage), and withdrawals used for medical expenses are tax-free; withdrawals for other purposes are taxed as income plus a 30% penalty. The accounts are restricted to people with minimum essential health coverage and cannot be held alongside health savings accounts or flexible spending arrangements.

Why we flagged it

The bill's core mechanism is the creation of a new tax-deferred savings vehicle for medical expenses, modeled on existing HSAs and FSAs but with distinct eligibility and contribution rules. It is a straightforward tax policy instrument, not a deregulation, subsidy, or rider.

What the text implies

• The income exclusion for employer contributions (capped at $100,000 AGI) creates a cliff effect where higher-income workers lose the tax benefit entirely, potentially incentivizing income-shifting strategies or employer benefit design workarounds.
• The prohibition on holding HOPE Accounts alongside HSAs or FSAs may force workers to choose between account types, potentially disadvantaging those whose employers offer FSAs but not HOPE Accounts, fragmenting the health savings landscape.
• The 30% penalty on non-qualified distributions is substantially higher than the 20% penalty on HSA non-qualified distributions, creating a disproportionate tax burden on account holders who face unexpected medical or financial hardship.
• Coordination with state Medicaid programs (Section 530A(b)(3)) allows states to contribute to HOPE Accounts as a cost-sharing reduction mechanism, potentially shifting state healthcare costs into individual accounts while reducing direct state spending visibility.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

The bill offers a genuine tax benefit to individuals saving for medical expenses—tax-free growth and withdrawals for qualified care reduce out-of-pocket costs for those who can afford to save. However, the benefit is capped at lower-income thresholds ($100,000 AGI for individual contributions to be excluded from income), excludes people already using HSAs or FSAs, and requires continuous health coverage eligibility, meaning it primarily benefits employed or insured individuals with disposable in

Who stands to gain

• banks and insurance companies serving as trustees
• financial services firms managing HOPE Account investments
• employers offering HOPE Accounts as employee benefits

Named in the bill

Internal Revenue Code, Section 530A (new), Health Savings Accounts (HSAs), Flexible Spending Arrangements (FSAs), Archer MSAs, Indian Health Service, Medicaid, Patient Protection and Affordable Care Act, Treasury Department, Department of Health and Human Services

Where it stands

18 cosponsors: 9 Democrats, 9 Republicans.

• Feb 4, 2025 — Introduced · Congress.gov: “Introduced in House”
• Feb 4, 2025 — Referred to House Committee on Ways and Means · Congress.gov: “Referred to the House Committee on Ways and Means”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

2 lobbying clients named this bill on 2 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $1,190,000 in lobbying spend. A filing names 35 bills on average, so that figure is what each filing reported, not a share belonging to this bill.

More lobbying clients named this bill than 41% of bills with at least one filing.

Blake Moore, the sponsor, reported $1,475,500 in PAC receipts in the 2026 cycle.

• Americans for Prosperity — $660,000 on 1 filing
• Healthequity, Inc. — $530,000 on 1 filing

Lobbying Disclosure Act filings through Jul 16, 2026. A filing shows who paid to lobby on a bill it names, not what changed.