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SB2431
THE SENATE
S.B. NO.
2431
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII
A BILL FOR AN ACT
relating
to health savings accounts
.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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SECTION 1.
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The legislature finds that access to
preventive care, telehealth, and urgent care improves health outcomes and helps
to control long-term health costs.
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Recent changes at the federal level will result in the loss of Medicaid
coverage for many residents of the State, causing many policyholders to
transition between public, employer-sponsored, and individual insurance
plans.
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The legislature further finds
that during periods in which a great number of policyholders transition between
insurance plans, commercial health insurance prices spike and often become
unaffordable.
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The
legislature recognizes that these reforms are intended to preserve the
protections of the Prepaid Health Care Act for full-time workers while
modernizing coverage options for others, and that direct payment agreements for
routine primary care services are not insurance and may be used in combination
with coverage offered under this Act, to the extent permitted under federal
law.
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The
legislature also finds that, due to federal rule changes effective January 1,
2026, federally qualified health savings-account eligible high deductible
health plans, including low-premium bronze and catastrophic plans, when paired
with health saving accounts, may offer an affordable, flexible, and portable
coverage option.
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The legislature
additionally finds that rural and medically underserved areas face ongoing
access and market participation challenges, and that targeted incentives may
encourage insurers to offer coverage options to individuals in these
communities.
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Accordingly,
the purpose of this Act is to expand affordable coverage options and promote
continuity of care by:
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(1)
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Establishing
a tiered, nonrefundable tax credit for qualified insurers offering federally
qualified health savings account-eligible high deductible health plans in the
State, with enhanced incentives for plans written in rural and medically
underserved areas; and
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(2)
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Requiring
qualified insurers to match up to a certain amount of a policyholder's
first-time contribution into a health savings account.
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SECTION
2.
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Chapter 235, Hawaii Revised Statutes,
is amended by adding a new section to be appropriately designated and to read
as follows:
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�235-
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Health savings account-eligible high
deductible health plan tax credit; first-time contribution match.
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(a)
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There shall be allowed to each qualified taxpayer subject to the tax
imposed under this chapter, a health savings account‑eligible high
deductible health plan tax credit that shall be deductible from the taxpayer's
net income tax liability, if any, imposed by this chapter for the taxable year
in which the credit is properly claimed.
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(b)
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The tax credit shall be:
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(1)
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$
for each federally qualified health savings account-eligible high deductible
health plan that is written by a qualified taxpayer in an area of the State
that is not medically underserved area;
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(2)
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$
for each federally qualified health savings account-eligible high deductible
health plan that is written by a qualified taxpayer in a non-rural medically
underserved area of the State;
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(3)
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$
for each federally qualified health savings account-eligible high deductible
health plan that is written by a qualified taxpayer in a partially rural medically
underserved area of the State; and
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(4)
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$
for each federally qualified health savings account-eligible high deductible
health plan that is written by a qualified taxpayer in a rural medically
underserved area of the State;
provided
that the tax credit shall only apply to each federally qualified health savings
account-eligible high deductible health plan written in the State by a
qualified taxpayer on or after January 1, 2026; provided further that the total
amount of tax credits claimed by a qualified taxpayer shall not exceed
$ for the taxable
year.
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(c)
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To be eligible for the tax credit under this
section, a qualified taxpayer shall match an amount of up to
$ for a
policyholder's first-time contribution into a health savings account.
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(d)
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The total amount of tax credits allowed under
this section shall not exceed
$ for all qualified
taxpayers in any taxable year; provided that any qualified taxpayer who is
ineligible to claim the credit in a taxable year due to the
$ cap having been
exceeded for that taxable year shall be eligible to claim the credit in the
subsequent taxable year.
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(e)
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The director of taxation:
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(1)
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Shall prepare any forms that may be
necessary to claim a tax credit under this section;
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(2)
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May require a qualified taxpayer to
furnish reasonable information to verify the claim for the tax credit made
under this section; and
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(3)
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May adopt rules pursuant to chapter
91 necessary to carry out the purposes of this section.
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(f)
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The credit allowed under this section shall
be claimed against the net income tax liability for the taxable year.
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If the tax credit under this section exceeds
the taxpayer's net income liability, the excess of credit over liability may be
used as a tax credit against the taxpayer's net income tax liability in
subsequent years until exhausted.
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All
claims for tax credits under this section, including any amended claims, shall
be filed on or before the end of the twelfth month following the close of the
taxable year for which the credit may be claimed.
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Failure to comply with the foregoing
provision shall constitute a waiver of the right to claim the credit.
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(g)
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For the purposes of this section:
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"Health
savings account" has the same meaning as defined under section 223(d)(1)
of the Internal Revenue Code of 1986, as amended.
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"High
deductible health plan" means a plan that is:
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(1)
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Available as individual coverage
through an exchange under section 1311 or 1321 of the Patient Protection and
Affordable Care Act; and
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(2)
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A bronze plan, as described in
section 1302(d)(1)(A) of the Patient Protection and Affordable Care Act, or a
catastrophic plan, as described in section 1302(e) of the Patient Protection
and Affordable Care Act.
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"Medically
underserved area" or "population" means a geographic area or population
group designated by the United States Department of Health and Human Services
as an area with a shortage of primary care health services or a population
group experiencing a shortage of primary care health services and facing
economic, cultural, or linguistic barriers to access health care.
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"Qualified
taxpayer" means a taxpayer that:
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(1)
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Offers one or more health savings
account-eligible high deductible health plans that are in compliance with
section 223 of the Internal Revenue Code of 1986, as amended, for residents of
the State, including those in rural and medically underserved areas; and
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(2)
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Enrolls at least
policyholders in one or more federally qualified
health savings account-eligible high deductible health plans.
"
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SECTION
3.
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New statutory material is
underscored.
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SECTION
4.
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This Act, upon its approval, shall
apply to taxable years beginning after December 31, 2025, and shall be repealed
on December 31, 2030.
INTRODUCED BY:
_____________________________
Report Title:
Department
of Taxation; Health Insurance; Health Savings Account-Eligible High Deductible
Health Plan; Bronze Plan; Catastrophic Plan; Tax Credit; Medically Underserved
Areas
Description:
For
taxable years beginning 1/1/2026, establishes a tiered nonrefundable tax credit
for qualified taxpayer insurers that offer one or more federally qualified health
savings account‑eligible high deductible health plans in the State, under
certain conditions, and increasing the tax credit to incentivize more plans
being written in rural medically underserved areas of the State.
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Requires qualified taxpayer insurers to match
up to a certain amount of a policyholder's first-time contribution into a
health savings account.
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Sunsets
12/31/2030.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.