A Former IRS Commissioner Just Made the Case for the HSA Market We're Building

Danny Werfel, who was the Commissioner of the IRS during the Biden administration, has joined the chorus of voices arguing that flexible health spending accounts like HSAs can help address the chronic disease crisis by helping more Americans invest in evidence-based preventive care.

Now is the time, Werfel argues, for the IRS to update its guidance on telehealth and preventive health products to expand access and lower healthcare costs for millions across the country. Doing so presents a rare bipartisan win for both MAHA and progressive healthcare advocates.

We'd encourage you to read the full piece in Bloomberg. It's a clarifying read from someone who has sat on the enforcement side of HSA compliance, and one that describes, almost line for line, the standard we built Truemed to meet.

Health Savings Accounts are sometimes viewed as a shelter for Americans to invest pre-tax dollars and shrink their income tax bills in April. But today that's not how HSAs are typically used. HSAs today act as a discount on the costs of out-of-pocket health costs. They provide Americans with an incentive to spend tax-advantaged dollars on products or services that lead to better health outcomes — especially the preventive care that keeps people from needing expensive acute treatment later on. When preventive care incentives work, they both help individuals remain healthy and bend the cost curve for everyone.

The need for that incentive has only grown. When Congress created the HSA in 2003, roughly one in three American adults was overweight or obese. Today it's nearly three in four. If HSAs were just a tax shelter, prudent tax policy might be to keep as few Americans from qualifying as possible. However, because benefit enables Americans to invest in preventive, evidence-based interventions like exercise — which is often hard to access under traditional forms of health insurance — shutting out eligible Americans is a failure that could add costs down the line. The real task is making sure the Americans who qualify can actually use their HSAs, without leaving the door open to abuse.

As Werfel lays out, there are two compelling reasons for the IRS to update its 2024 guidance.

The first is telehealth. When the IRS first tightened its stance on HSAs, the in-person doctor's visit was the assumed standard for a trustworthy clinical encounter. That assumption is now out-of-date: as Werfel shares in his piece, 54% of Americans have now had a telehealth visit, and 71% of physicians report using telehealth weekly, up from just 25% in 2018. Congress recognized this shift when it permanently extended the telehealth safe harbor for HSAs in the One Big Beautiful Bill.

With that statutory change, Werfel argues, the IRS has a clear opening to clarify that nothing in its rules prohibits a telehealth encounter from serving as the basis for a Letter of Medical Necessity, so long as that encounter satisfies applicable state law. That clarity matters, because the IRS suggested in 2024 that such documentation had to result from face-to-face interactions, leaving the status of a genuine telehealth encounter unclear.

The second is the evidence base. The 2024 notice left the impression that categories like nutrition, supplements, and exercise were inherently suspect. Werfel argues the opposite: eligibility was never supposed to be about the product. Werfel’s piece explains that the American College of Preventive Medicine, a board-certified specialty recognized by the AMA, has found credible evidence that nutrition, fitness, and lifestyle interventions can prevent and manage chronic disease. Those interventions got a bad reputation not because the science was weak, but because too many bad actors cut corners to justify them. What should determine eligibility, Werfel writes, is the purpose an expense serves, treating or preventing a specific medical condition, not the product category itself.

Here's the part of Werfel's argument we want to underline, because it's the heart of how we operate.

Werfel describes what a trustworthy company in this space looks like: one that hires physicians to make clinical recommendations; that takes tax compliance seriously; that builds rigorous quality controls and upholds documented standards; that does not support products that fail to have evidentiary support and legitimate clinical applications; and that legitimately screens patients using industry-standard telehealth practices. That kind of infrastructure costs real money to build, and Truemed has invested heavily to make sure we lead the industry in compliance.

That's the operating standard for handling HSA and FSA payments responsibly, and point for point, it's the standard Truemed was built to meet. Every qualification on our platform runs through a licensed practitioner who makes an individualized medical determination. Letters of Medical Necessity are issued only when clinical need is actually established. We turn people away when the evidence isn't there, and we treat that rejection rate as a quality metric, not a lost sale. To us, the guardrails Werfel described aren't something to work around, but rather they're specifications we view as our North Star.

Werfel's call is a simple one: the IRS can improve American’s health outcomes by clarifying its guidance on how the rules should work today. Clearer guidance on telehealth and preventive care wouldn't loosen the rules, but would help more Americans actually use a tax benefit that can help keep them healthy in the first place.

That's the future Truemed is building. Most healthcare dollars in this country get spent after someone is already sick. The things that keep people healthy, like exercise, nutrition, sleep, and recovery, are treated as luxuries instead of medicine. Truemed exists to connect the pre-tax dollars people already have to the interventions that are clinically proven to make a difference in their health. The clarity Werfel is calling for wouldn't change that work. It would simply let it reach more of the people it was built for.