Primary Care Enhancement Act of 2025
SB 1719, the Primary Care Enhancement Act of 2025, would change the federal tax treatment of direct primary care (DPC) arrangements. The bill defines a DPC arrangement as one in which an individual receives only primary care services from a primary care practitioner for a fixed periodic fee, and it treats those fees as “medical care” for purposes of the Internal Revenue Code. It also limits the definition so that certain services are excluded, including procedures requiring general anesthesia and laboratory services not typically provided in an ambulatory primary care setting.
The bill would also protect health savings account eligibility by specifying that a DPC arrangement is not a health plan or insurance for HSA purposes. In addition, it would require employers to report DPC fees on Form W-2 when the arrangement is provided through employment. The bill sets a monthly cap on eligible fees of $150 per individual, with a higher cap for arrangements covering more than one person, and it indexes that amount for inflation after 2026. The changes would apply to months beginning after December 31, 2025.
In practical terms, the bill would amend several sections of the Internal Revenue Code, including sections governing medical expense deductions, HSAs, and wage reporting. It would likely make DPC arrangements more attractive to patients, employers, and providers by clarifying that participation does not disqualify HSA contributions and by allowing the fees to be treated as qualifying medical expenses within the statutory limits.
The available legislative history shows no recorded votes or committee debate, so there is little direct evidence of support or opposition in the provided materials. The bill’s introduction by a bipartisan group of senators suggests at least some cross-party interest in expanding access to primary care and clarifying tax rules. Because there are no transcripts or votes, the overall sentiment can only be characterized as neutral-to-supportive based on sponsorship and the bill’s purpose.
Potential points of contention are likely to center on the tax treatment of DPC fees, the $150 monthly cap, and whether the arrangement should be treated as medical care without undermining existing HSA and insurance rules. Stakeholders concerned about revenue effects, IRS administration, or the boundary between primary care and broader medical services may scrutinize the exclusions and reporting requirements. Supporters are likely to include primary care physicians, direct primary care practices, patients seeking more predictable access, and advocates for HSA-compatible coverage options.
The bill would amend the Internal Revenue Code to expressly treat qualifying direct primary care service arrangements as medical care for itemized medical expense purposes, while also preserving HSA eligibility by excluding those arrangements from the definitions of health plan and insurance. It would add a new reporting requirement for employer-provided DPC fees on Form W-2 and establish a monthly dollar limit, indexed for inflation after 2026, on the amount of fees that can be treated as eligible. These changes would affect taxpayers, employers, primary care providers, and HSA participants by clarifying federal tax treatment and potentially expanding access to direct primary care arrangements.
There is no committee transcript or vote record in the provided materials, so no formal debate history is available. The bill appears generally favorable in tone, as it is a bipartisan introduction aimed at expanding and clarifying access to primary care through tax code changes. The absence of recorded opposition or amendments suggests that the available evidence points to a neutral-to-supportive reception, though that cannot be confirmed from the record provided.
The main likely points of contention are the tax implications of classifying direct primary care fees as medical care, the monthly fee cap and inflation adjustment, and the interaction with HSA rules and insurance definitions. Critics may question whether the bill creates a tax preference for a particular care model or complicates IRS administration, while supporters are likely to argue that it removes barriers to primary care access and preserves HSA compatibility. Because there are no transcripts or votes, specific member or stakeholder objections are not documented in the provided materials.