Congress·In Committee·H.R. 138

Biden-era bill targets caregiver costs by letting health accounts pay parents’ medical bills

Lowering Costs for Caregivers Act of 2025

about 1 year ago·View on Congress.gov

Part of: New Legislation Expands HSA and FSA Benefits for Caregivers

⏸

Stalled

No legislative action in over 90 days.

Legislative Progress

House

Senate

President

Law

Key Points

Lets you use your Health Savings Account to pay for your parent’s medical care, not just your own or your spouse’s.
From policy text
“Subparagraph (A) of section 223(d)(2) of the Internal Revenue Code of 1986 is amended by inserting ``, any parent of either such individual or such spouse'' after ``the spouse of such individual''.”
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Lets workplace health spending accounts and employer health reimbursement funds pay for a parent’s medical bills without making it taxable income.
From policy text
“A health flexible spending arrangement or health reimbursement arrangement shall not fail to be treated as meeting the requirements of this subsection or section 106, and no amount shall be included in gross income of the taxpayer, solely because, under the arrangement, the taxpayer may use amounts contributed to such arrangement for medical care (as defined in section 213(d), without regard to paragraph (1)(D) thereof) for a parent of the taxpayer or of the spouse of the taxpayer.”
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Applies to money spent or expenses incurred after December 31, 2024, so it would cover costs starting in 2025.
From policy text
“The amendment made by this section shall apply to amounts paid after December 31, 2024.”
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Could help families caring for aging parents by letting them use pre-tax dollars, which can lower out-of-pocket costs.
This does not create new benefits for everyone—it mainly helps people who already have these health accounts through work or their insurance setup.

TaxesHealthcareLabor Employment

Impact Analysis

Personal Impact

How this policy affects specific groups of people

Positive Impacts(1)

Chronic Illness

Helps

Milestones

2 milestones2 actions

Jan 3, 2025House

Referred to the House Committee on Ways and Means.

Jan 3, 2025

Introduced in House

What Happens Next

Projected impacts based on AI analysis

Within the first plan year after the law takes effect

Employers and benefits administrators may update plan documents and claims systems to reflect parent-eligible reimbursements

You might not see the change in your workplace portal right away; your employer may need time to update rules, forms, and customer support guidance.

Throughout 2025 and later years

Families start using the expanded rules during the year as parent medical bills come up

The real savings show up when you pay or get reimbursed for your parent’s care (for example, prescriptions, doctor visits, or equipment) using these accounts instead of after-tax cash.