Health Savings Accounts (HSAs) are touted for the big benefits they provide employees to help lower the cost of their out-of-pocket medical expenses. These federally-approved HSAs serve as a way for people to be able to save money for expected medical expenses in an account where their money will grow.

The best part about HSAs is that all money that is contributed to them and taken out of them is tax-free, as are any gains that are made while the money is in the account.

Minor tweaks are typically made every year to HSAs to adhere to increasing costs and income levels, but 2025 is bringing about the biggest changes that have been seen in years. Thanks to the spending package that Congress passed and President Donald Trump signed in early summer, an expansion of HSAs is on the horizon.

In this article, we break down South Carolina HSA changes for 2025 and beyond.

Changes to Federal Limits

The first HSA change that took effect at the start of this year was new contribution limits. This is something that typically happens every year, to compensate for inflation.

The 2025 HSA contribution limit for self-only coverage rose by $150 to $4,300, while the family coverage limit rose by $250 to $8,550.

There is also a catch-up provision that allows individuals who are 55 years and older to contribute an additional $1,000, regardless of what type of coverage they have.

To be eligible for an HSA, you must have a high-deductible health plan (HDHP) with a minimum deductible of $1,650 for self-only coverage or $3,300 for family, which is an increase of $50 and $100 over 2024, respectively.

The out-of-pocket maximum for those plans must be $8,300 for self-only coverage (an increase of $250) or $16,600 for family coverage (an increase of $500).

South Carolina provides a tax deduction on the state level for contributions to HSAs. The state also typically will conform to whatever the federal tax code says, and it aligns with the above federal limits for 2025, too.

Increased Eligibility

Under the new spending federal package, there is a massive expansion of what plans are eligible for an HSA. Starting January 1, 2026, all catastrophic and bronze plans available on the health care marketplace will qualify for HSAs.

Previously, these plans were not eligible for HSAs, even if they came with a high deductible.

This change alone will increase eligibility for HSAs on a potentially significant scale. In fact, many health insurance experts have said that this is the biggest change in HSA eligibility since the program was first created.

Telehealth Inclusion

A provision under the new law is actually retroactive to January 1 of 2025, allowing people to go back and qualify for certain telehealth services. Now, HDHPs can cover expenses for telehealth before the subscriber has met their deductible, without that disqualifying them from opening up and then contributing to one of the HSAs available.

This is known as “first-dollar coverage,” and as mentioned is retroactive back to the beginning of the year. In addition, the provision is permanent, so it won’t expire.

This is a big change that will affect a lot of people, as the National Center for Health Statistics stated that nearly one-third of all U.S. adults used telemedicine in 2022 alone.

Access to Direct PCP Fees

Before this new law was passed, one disqualifying action for an HSA was if an individual had a direct service arrangement with their primary care physician. This agreement essentially allowed people to pay fixed fees on a monthly basis for all PCP services.

The new law, though, changes this — allowing these service agreements to be in place while not disqualifying individuals from participating in an HSA. This change begins after December 31 of this year, and will help many people pay for PCP fees with tax-advantaged accounts.

Work with Beckham Ellis Insurance Group for Your Employees’ Health Plan

Annual changes to HSAs are nothing new, but 2025 has brought about some big adjustments in South Carolina and beyond. Massive changes came as a result of the federal government’s new spending package passed in early July, which go way beyond simple increases to maximum contribution limits.

Navigating health insurance benefits can be quite complicated, especially with new federal regulations and changes happening on an almost yearly basis. That’s why it pays to partner with an experienced company such as Beckham Ellis Insurance Group.

Our team of experts can help your company craft a benefits package that saves you money and increases your retention and recruitment efforts. We can help you see all plans that might work for you, including some that allow employees to contribute to HSAs.

If your company is located in the South Carolina or Georgia region, contact us today to learn more.