“A bill to establish a health freedom waiver program, to promote better price reporting and outcomes, and for other purposes.”
No CRS summary available for this bill.
This section establishes a new Health Freedom Waiver Program under the Affordable Care Act (ACA), under which the Secretary of Health and Human Services (HHS) must waive, for plan years beginning on or after January 1, 2026, any of the following requirements in a participating state that maintains an invisible high-risk insurance pool or equivalent risk-mitigation program: (1) ACA Exchanges and related rules (Part 1 of subtitle D); (2) Consumer Operated and Oriented Plan (CO-OP) program (Part 2 of subtitle D); (3) cost-sharing reductions (Sec. 1402); and (4) premium tax credits (IRC Sec. 36B) and individual mandate (IRC Sec. 5000A). States may notify HHS of intent to participate via governor or majority legislative vote at least 90 days prior, including evidence of a high-risk pool. For states where waivers cause individuals and small employers to lose eligibility for premium tax credits, cost-sharing reductions, or small business health care tax credits, HHS must redirect the aggregate amounts—calculated using the national average silver benchmark premium among non-waiver states—directly into Trump Health Freedom Accounts (under new IRC Sec. 223(i)) of eligible state residents who enroll in exchange plans; payments occur monthly, quarterly, or as a lump sum at resident option. (Thus, federal ACA subsidies shift from supporting ACA-compliant plans to individual health savings accounts.) Participating states may operate their own ACA Exchange, authorize private commercial platforms (with HHS application program interface access), or default to a federal Exchange incorporating state laws in place of waived ACA provisions; HHS must also coordinate this process with ACA Sec. 1332 waivers and Medicare, Medicaid, and CHIP waivers into a single application option.
This section establishes Trump Health Freedom Accounts as a form of health savings account (HSA) for eligible individuals residing in a state with an active waiver under section 1335 of the Patient Protection and Affordable Care Act (ACA) and covered under a health plan offered on an ACA Exchange pursuant to such waiver. These accounts receive deposits transferred under ACA section 1335(a)(5), which are excluded from the HSA deduction under IRC §223(a); permits use of account funds to purchase health insurance; requires the account to be an individual's sole HSA (with rollover permitted from any prior HSA); and prohibits rollovers to non-Trump Health Freedom Accounts. This section further restricts account funds from paying premiums for any health plan covering (1) gender transition procedures or (2) abortion services, or from directly paying for such procedures or services. (Gender transition procedure means any hormonal or surgical intervention to change an individual's sex, including puberty blockers, cross-sex hormones, castration, hysterectomy, mastectomy, phalloplasty, vaginoplasty, and approximately 30 other specified procedures, with exclusions for disorders of sex development, treatment of complications from prior procedures, imminent physical dangers, precocious puberty, and male circumcision.)
This section modifies the Small Business Health Care Tax Credit (section 45R of the Internal Revenue Code) for eligible small employers in a state with a waiver under section 1335 of the Patient Protection and Affordable Care Act (i.e., state innovation waiver allowing departure from certain ACA requirements), for taxable years beginning after December 31, 2025. (As background, section 45R provides a tax credit equal to 50% (35% for tax-exempt employers) of employer-paid premiums for qualified health insurance offered through a Small Business Health Options Program Exchange to eligible small employers—generally, those with fewer than 25 full-time equivalent employees and average annual wages at or below approximately $62,000 (indexed for inflation)—with the credit phasing out above 10 full-time equivalents or $25,000 average wages and limited to two consecutive taxable years.) Under the modified rules— (1) the credit equals 50% of premiums for all eligible small employers (eliminating the 35% rate for tax-exempt employers); (2) any health plan authorized to be offered on an Exchange under the waiver is treated as a qualified health plan offered through an Exchange; (3) the phaseout based on employer size and wages does not apply; (4) an eligible small employer is one with fewer than 50 full-time equivalent employees (from 25), without regard to the average annual wage threshold; (5) the definition of employee disregards clause (i) of section 45R(e)(1)(A); (6) the credit is available for the first taxable year in which the employer (or predecessor) offers one or more qualified health plans to employees and all subsequent taxable years (eliminating the two-year limit); and (7) special rules for tax-exempt eligible small employers do not apply.
This section directs the Secretary of Health and Human Services, in coordination with the Secretaries of the Treasury and Labor, to update all regulations and guidance issued pursuant to Executive Order 13877 on healthcare price and quality transparency (i.e., rules requiring hospitals and insurers to disclose prices for items and services) not later than 90 days after enactment, including by (1) requiring disclosure of actual prices of items and services, not price estimates; (2) issuing updated guidance or regulations to standardize and make pricing information easily comparable across hospitals and health plans; (3) issuing guidance or proposed regulatory action to update enforcement policies ensuring compliance with transparent reporting of complete, accurate, and meaningful data; and (4) requiring public reporting of outcomes data by providers.