(d) REPORTING OF DIRECT PRIMARY CARE SERVICE 
ARRANGEMENT FEES ON W–2.—Section 6051(a) of such 
Code is amended by striking ‘‘and’’ at the end of para-
graph (16), by striking the period at the end of paragraph 
(17) and inserting ‘‘, and’’, and by inserting after para-
graph (17) the following new paragraph: 
‘‘(18) in the case of a direct primary care serv-
ice 
arrangement 
(as 
defined 
in 
section 
223(c)(1)(E)(ii)) which is provided in connection 
with employment, the aggregate fees for such ar-
rangement for such employee.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to months beginning after Decem-
ber 31, 2025, in taxable years ending after such date. 
SEC. 3. ON-SITE EMPLOYEE CLINICS. 
(a) IN GENERAL.—Section 223(c)(1) of the Internal 
Revenue Code of 1986, as amended by the preceding pro-
visions of this Act, is amended by adding at the end the 
following new subparagraph: 
‘‘(F) SPECIAL RULE FOR QUALIFIED ITEMS 
AND SERVICES.— 
‘‘(i) IN
GENERAL.—For purposes of 
subparagraph (A)(ii), an individual shall 
not be treated as covered under a health 
plan described in subclauses (I) and (II) of 
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such subparagraph merely because the in-
dividual is eligible to receive, or receives, 
qualified items and services— 
‘‘(I) at a healthcare facility lo-
cated at a facility owned or leased by 
the employer of the individual (or of 
the individual’s spouse), or 
‘‘(II) at a healthcare facility op-
erated primarily for the benefit of em-
ployees of the employer of the indi-
vidual (or of the individual’s spouse). 
‘‘(ii) QUALIFIED ITEMS AND SERVICES 
DEFINED.—For purposes of this subpara-
graph, the term ‘qualified items and serv-
ices’ means the following: 
‘‘(I) Physical examination. 
‘‘(II) Immunizations, including 
injections of antigens provided by em-
ployees. 
‘‘(III) Drugs or biologicals other 
than a prescribed drug (as such term 
is defined in section 213(d)(3)). 
‘‘(IV) Treatment for injuries oc-
curring in the course of employment. 
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‘‘(V) Preventive care for chronic 
conditions (as defined in clause (iv)). 
‘‘(VI) Drug testing. 
‘‘(VII) 
Hearing 
or 
vision 
screenings and related services. 
‘‘(iii) AGGREGATION.—For purposes 
of clause (i), all persons treated as a single 
employer under subsection (b), (c), (m), or 
(o) of section 414 shall be treated as a sin-
gle employer. 
‘‘(iv) PREVENTIVE CARE FOR CHRON-
IC CONDITIONS.—For purposes of this sub-
paragraph, the term ‘preventive care for 
chronic conditions’ means any item or 
service specified in the Appendix of Inter-
nal Revenue Service Notice 2019–45 which 
is prescribed to treat an individual diag-
nosed with the associated chronic condition 
specified in such Appendix for the purpose 
of preventing the exacerbation of such 
chronic condition or the development of a 
secondary condition, including any amend-
ment, addition, removal, or other modifica-
tion made by the Secretary (pursuant to 
the authority granted to the Secretary 
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under paragraph (2)(C)) to the items or 
services specified in such Appendix subse-
quent to the date of enactment of this sub-
paragraph.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to months in taxable years begin-
ning after December 31, 2025. 
SEC. 4. CONTRIBUTIONS PERMITTED IF SPOUSE HAS 
HEALTH 
FLEXIBLE 
SPENDING 
ARRANGE-
MENT. 
(a) CONTRIBUTIONS PERMITTED IF SPOUSE HAS A 
HEALTH FLEXIBLE SPENDING ARRANGEMENT.—Section 
223(c)(1)(B) of the Internal Revenue Code of 1986 is 
amended by striking ‘‘and’’ at the end of clause (ii), by 
striking the period at the end of clause (iii) and inserting 
‘‘, and’’, and by adding at the end the following new 
clause: 
‘‘(iv) coverage under a health flexible 
spending arrangement of the spouse of the 
individual for any plan year of such ar-
rangement if the aggregate reimburse-
ments under such arrangement for such 
year do not exceed the aggregate expenses 
which would be eligible for reimbursement 
under such arrangement if such expenses 
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were determined without regard to any ex-
penses paid or incurred with respect to 
such individual.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to plan years beginning after De-
cember 31, 2025. 
SEC. 5. FSA AND HRA TERMINATIONS OR CONVERSIONS TO 
FUND HSAs. 
(a) IN GENERAL.—Section 106(e)(2) of the Internal 
Revenue Code of 1986 is amended to read as follows: 
‘‘(2) QUALIFIED HSA DISTRIBUTION.—For pur-
poses of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
HSA distribution’ means, with respect to any 
employee, a distribution from a health flexible 
spending arrangement or health reimbursement 
arrangement of such employee contributed di-
rectly to a health savings account of such em-
ployee if— 
‘‘(i) such distribution is made in con-
nection with such employee establishing 
coverage under a high deductible health 
plan (as defined in section 223(c)(2)) if 
during the 4-year period preceding the 
date the employee so establishes coverage 
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