One Big Beautiful Bill: What Medical Practices Should Track Now
- Jeanette Delgado
- 8 hours ago
- 4 min read
The IRS published a consolidated overview of the One Big Beautiful Bill provisions. While some items read “tax-focused,” several changes affect how medical practices run payroll, benefits, vendor payments, and equipment purchases—which means your internal processes matter as much as the filing.
Key takeaways (1-minute summary)
HSAs get more flexible (telehealth + new plan types) and DPC can work with HSAs starting 2026.
A new overtime-related deduction increases W-2/reporting pressure (2025–2028).
Payment app thresholds changed for certain withholding rules—but taxability doesn’t change.
100% first-year depreciation is now permanent for eligible property (post–Jan 19, 2025).
ERC limitations may impact late claims for 2021 quarters.
Quick links
Why this matters to practice owners
Most practices don’t get tripped up by “tax rules.” They get tripped up by missing documentation, messy payroll coding, and inconsistent vendor tracking—then year-end becomes expensive cleanup.
This bill is a reminder: when rules change, the operational workflow has to change too.
HSA + telehealth + DPC changes
Telehealth can stay HSA-friendly (permanent starting 2025)
If your team is on HSA-compatible plans, telehealth services may be covered before the deductible without breaking HSA eligibility (plan years starting Jan. 1, 2025).
More plan types become HSA-compatible (starting 2026)
Beginning Jan. 1, 2026, bronze and catastrophic plans can qualify for HSA treatment.
Direct Primary Care (DPC) + HSAs (starting 2026)
Starting Jan. 1, 2026, certain DPC arrangements can coexist with HSA eligibility, and HSA funds may be used for periodic DPC fees (within the rules).
What to do inside the practice
If you offer benefits: flag this for your broker and update employee benefit communication.
If you’re exploring DPC: document fee structure and confirm eligibility details before rolling it out.
Payroll: overtime deduction and what to track
For tax years 2025–2028, there’s an overtime-related deduction concept that generally focuses on the premium portion of overtime (not the base pay). The key operational impact: your payroll system must capture it correctly for reporting.
Where practices get burned
Overtime coded inconsistently (earnings codes not standardized)
Manual adjustments that don’t map cleanly to reporting
End-of-year reclass work that’s time-consuming and error-prone
What to do now
Confirm payroll can separately identify overtime premium (earnings code setup).
Add a monthly review step: overtime totals (payroll report) match overtime expense (GL).
Keep supporting documentation tight: timekeeping approvals + policy.
If you run multiple payroll schedules, build a simple monthly payroll tie-out that reconciles totals by payroll date to the general ledger. That prevents year-end surprises.
Contractors + payment apps: what changed
The IRS highlights changes tied to third-party payment platforms. The practical takeaway for practices:
Don’t confuse “reporting/withholding thresholds” with “taxable income”
Even if thresholds change, income can still be taxable. Operationally, you still need clean vendor records.
What to do now
Require W-9 collection before payment (not after).
Track vendors across all payment methods (ACH, check, card, payment apps).
Run a quarterly “vendor hygiene” review: name, entity type, tax ID, address, W-9 on file.
Equipment purchases: permanent 100% first-year depreciation
For eligible purchases acquired after Jan. 19, 2025, guidance describes permanent 100% additional first-year depreciation (with elections and specific requirements).
Why this matters If you’re buying
clinical equipment
IT systems
furniture/buildout equipment
…timing and documentation matter.
What to do now
Track placed-in-service date (not just purchase date).
Keep invoices + financing docs + installation/activation notes together.
Maintain a clean fixed asset schedule that ties to the books.
ERC limitation: what it means
The IRS notes limitations on credits/refunds for certain late-filed ERC claims tied to 2021 quarters.
What to do now
If your practice filed ERC late (especially through a third party):
organize support docs, calculations, and correspondence
confirm your books reflect the ERC activity cleanly
keep everything in a single “ERC substantiation” folder
Practice checklist: what to do now
Use this as your “operations-first” action list:
Benefits
Ask broker: do these HSA/DPC changes affect our plan strategy for 2026?
Update employee comms for HSAs/telehealth rules (if applicable)
Payroll
Confirm overtime premium has a dedicated earnings code
Monthly tie-out: payroll reports ↔ GL wage/tax accounts
Document your overtime approval workflow
Vendors
W-9 before payment policy
Quarterly vendor audit (entity type, tax ID, address, 1099 flag)
Assets
Fixed asset tracker with placed-in-service dates
Central folder per asset (invoice, financing, install/activation)
FAQ
What are the biggest impacts for medical practices?
Benefits strategy (HSA/DPC), payroll reporting related to overtime, cleaner contractor tracking, and stronger documentation for equipment purchases.
Does a payment app threshold change mean income isn’t taxable?
No. Thresholds affect certain reporting/withholding mechanics. Taxability is a separate issue.
What should I do first if I’m short on time?
Start with payroll coding + monthly payroll-to-GL tie-outs and W-9 vendor hygiene. Those prevent the most expensive cleanup.
