HB1650, titled the Telehealth Expansion Act of 2025, would permanently extend a tax rule that currently allows high-deductible health plans to cover telehealth services before a deductible is met. Under current law, that telehealth safe harbor has been temporary; this bill would make it permanent by amending Section 223 of the Internal Revenue Code. The measure also updates related language so that telehealth coverage is disregarded for purposes of the high-deductible health plan rules in the same way going forward.
The bill is narrowly focused on federal tax treatment of health plans rather than on direct regulation of telehealth services themselves. Its practical effect would be to preserve employer-sponsored and individual high-deductible health plan flexibility to offer telehealth benefits without jeopardizing health savings account eligibility. The amendments would apply to plan years beginning after December 31, 2024, meaning the change would take effect immediately for future plan years once enacted.
Impact
HB1650 would amend the Internal Revenue Code of 1986, specifically Section 223 governing health savings accounts and high-deductible health plans, to make permanent the telehealth safe harbor that allows telehealth services to be covered without a deductible. This would affect insurers, employers offering HDHPs, plan administrators, and enrollees who use telehealth while maintaining HSA eligibility. It would also remove the need for periodic congressional extensions of the telehealth exception.
Sentiment
The available context suggests generally favorable bipartisan support for the bill. The bill was introduced by members from both parties, including Mr. Arrington, Ms. Lee of Nevada, Mr. Smith of Nebraska, Mr. Schneider, and Mr. Panetta, which indicates cross-party interest in preserving telehealth access. No committee transcript or recorded votes are available, but the sponsorship pattern suggests the measure is viewed as a practical health coverage and access issue rather than a partisan one.
Contention
No specific points of contention are documented in the provided materials. The main policy issue implicit in the bill is whether the telehealth exemption should be made permanent rather than allowed to expire or remain temporary. Potential concerns, if raised, would likely center on federal tax policy, the long-term cost or design of high-deductible health plans, and whether permanent telehealth coverage without a deductible changes incentives in HSA-qualified plans, but none of those objections appear in the available record.