Committee advances bill to permit pretax health savings accounts for high-deductible plans for state employees

House Bill 422, which would permit pretax health savings account (HSA) contributions tied to high-deductible health plans for state employees, was advanced by the House Insurance Committee by voice vote.

Representative McCullough, the bill’s sponsor, said the measure would allow payroll pretax treatment for HSA contributions for state employees enrolled in high-deductible plans. He said pretax treatment would save roughly 7.65% on payroll taxes for both the state and employees. The sponsor told the committee that similar pretax HSA programs are common among Georgia private employers and that the state would realize substantial savings.

“We're trying to make the high deductible health savings account pretaxed,” Representative McCullough said. He described HSAs as a long-term savings and retirement tool, noting funds typically roll over year to year and can be used tax-free for qualified health expenses or, after age 65, for other uses.

Committee members asked implementation questions. Representative Gullett asked about meeting the bill’s implementation date (the bill references including at least two high-deductible plans by Oct. 1, 2025). Representative McCullough acknowledged implementation timing could change and said departments were continuing work on facilitation and enrollment logistics. Representative Hughley flagged a fiscal note showing a $300,000 one-time cost for marketing the program and asked how employees would be educated; the sponsor said human-resources offices would handle employee education and plan selection.

No public commenters appeared to testify during the committee hearing. The committee approved a do-pass recommendation by voice vote with no recorded opposition. Committee members noted implementation details and dates may be adjusted as the bill proceeds in the legislative process.