Small business owners and consultants urge expanded HSAs, ICRAs and direct primary care to lower costs
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Summary
Small‑business testimony at the Ways and Means Health Subcommittee called for expanded health savings account rules, broader use of individual coverage HRAs (ICRAs) and access to direct primary care, saying those tools can improve preventive care and make employer benefits more affordable for small employers.
Marcy Strauss, a small business owner and benefits consultant, told the House Ways and Means Health Subcommittee that small employers need more flexibility to offer affordable benefits, including expanded health savings account (HSA) rules, wider use of individual coverage health reimbursement arrangements (ICRAs) and the ability to use HSAs to pay for direct primary care memberships.
“HSAs have become quite popular, over the last several years. For us, we pretty much put an HSA qualified plan in with every one of our group benefits that we write,” Strauss said. She described local trends she sees: family premiums in her home county rose about 85% over eight years and small‑group participation has fallen; she attributed those patterns to mounting premium costs and limited plan choices for small employers. She said allowing HSAs to cover more preventive and holistic services, increasing contribution limits and permitting Medicare beneficiaries to continue contributing would improve participation.
Strauss described practical barriers to wider ICRA adoption by small employers. Under current marketplace rules, she said, an employer contribution that is insufficient to offset marketplace subsidies can leave an employee without marketplace premium tax credits; she urged tax incentives or contribution offset mechanisms to make ICRAs practical for small firms. She also recommended allowing HSA funds to pay for direct primary care memberships, which she called “medical home” services that can improve access through telehealth, texting and workplace wellness activities.
Committee members from both parties pressed witnesses about how prevention‑oriented savings vehicles and employer choice could change outcomes. Supporters argued these tools can lower premiums, give employees more control over spending and help employers remain competitive in hiring. Witnesses and members emphasized the need for consumer education and regulatory fixes so small employers can adopt these options without unintentionally reducing employees’ marketplace subsidies.
