HSAs Expand to Cover Lifestyle Products, Raising Questions of Equity and Access
WASHINGTON – A growing market for Health Savings Account (HSA)-approved products is allowing Americans to use pre-tax healthcare dollars for items ranging from red cedar ice baths to high-end saunas, even as basic health insurance premiums remain ineligible for HSA funds. The trend, fueled by major retailers like Amazon, Walmart, and Target launching dedicated HSA storefronts, and the rise of companies like Truemed, is sparking debate over the appropriate use of these accounts and whether they exacerbate health inequities.
Health savings Accounts were originally designed to help individuals with high-deductible health plans save for qualified medical expenses. However, a recent expansion of eligible expenses-backed by Republicans-has broadened the definition to include certain lifestyle interventions and wellness products. This shift comes as the GOP seeks alternatives to the Affordable Care Act, and HSAs are increasingly positioned as a consumer-driven healthcare solution.
Startups like Truemed, co-founded in 2022 by Calley Means, a former ally of Health and Human Services Secretary Robert F. Kennedy Jr.,are facilitating access to these previously less-accessible HSA purchases. Truemed offers items like a $9,000 cedar ice bath, a $2,000 hemlock sauna, and a $1,700 “smart” bassinet, all eligible for HSA funds. While these higher-ticket items garner attention, Truemed CEO Justin Mares told KFF Health News that the company’s most popular products are smaller-dollar fitness offerings, including kettlebells, supplements, treadmills, and gym memberships.
“What we’ve seen at Truemed is that, when given the choice, Americans choose to invest their health care dollars in these kinds of proven lifestyle interventions,” Mares said.
The expansion of HSA eligibility coincides with Means’ recent government service. He joined the Department of Health and Human services in November after a period at the White House,where he worked during the passage of the “One Big Stunning bill Act” in July.Truemed’s general counsel, Joe Vladeck, confirmed Means left the company in August.
Concerns have been raised about potential conflicts of interest, prompting a statement from HHS spokeswoman Emily Hilliard. “Calley Means will not personally benefit financially from this proposal as he will be divesting from his company since he has been hired at HHS as a senior advisor supporting food and nutrition policy,” Hilliard stated. Details of Means’ divestment plan have not been publicly disclosed,as Truemed is a privately held company.
The debate over HSA expansion highlights a fundamental question: should pre-tax healthcare dollars be used for preventative lifestyle choices, or prioritized for essential medical care and insurance coverage? Critics argue that allowing HSAs to cover luxury wellness items while excluding insurance premiums disproportionately benefits higher-income individuals who can already afford these products, potentially widening health disparities.
