The Internal Revenue Service hopes to give workers a new way to pay for health care: letting them use ordinary health reimbursement arrangements (HRAs) to pay for direct primary care program memberships.
The IRS proposal could help a worker lock in everyday health care costs for a year, while owning low-deductible major medical insurance, or major medical insurance with a very high deductible.
The proposal could also help primary care doctors reduce the amount of time and money they spend on billing insurers and patients for specific services. The doctors could simply ask the patients to pay the direct primary care program membership fee on an annual, quarterly or monthly basis.
Those doctors could focus solely on providing care through direct primary care arrangements, and stop working directly with health insurers, or they could work with insurers only when delivering unusual or advanced forms of care outside of the direct primary care arrangements.
The IRS has described the proposal in a notice of proposed rulemaking published today in the Federal Register.
- A copy of the proposed HRA regulations is available here.
- An article about efforts to help people use health savings accounts to pay for direct primary care arrangements is available here.
Comments on the proposal are due Aug. 10.
The proposal contact people are Richard Gano IV , an income tax and accounting specialist at the IRS Office of Associate Chief Counsel, and William Fischer, an employee benefits specialist at the IRS Office of Associate Chief Counsel.
The federal government is offering taxpayers a growing number of types of accounts they can use to pay for health care with employer contributions or personal contributions that aren’t taxed.
The best known personal health account may be the health savings account (HSA). A taxpayer must use an HSA together with health insurance that comes with a minimum deductible and limits out-of-pocket expenses, including deductibles, to a maximum level.
For this year, the minimum self-only deductible for HSA-compatible coverage is $1,400.
The self-only out-of-pocket spending limit is $6,900.
Meanwhile, the annual out-of-pocket limit for individual major medical insurance is $8,150.
The IRS currently forbids HSA owners from using HSA funds to pay direct primary care fees, because it sees a direct primary care arrangement as being a low-deductible or no-deductible health plan.