IRS Extends HSA/HDHP Relief for COVID-19 Testing and Treatment

Recently issued IRS guidance has temporarily extended a previously-issued relief policy that allows high deductible health plans (HDHPs) to provide COVID-19 testing and treatment without a deductible affecting an individual’s HSA eligibility.

The extension will expire on plan years ending on or before December 31, 2024.

Generally, an HDHP plan cannot provide benefits before a deductible is satisfied. Near the beginning of the COVID-19 pandemic, the IRS issued Notice 2020-15, which stated that an otherwise HSA-qualified HDHP would not lose the qualification if it provides coverage for COVID-19 testing and treatment before the participant meets their minimum deductible.

The new guidance also reaffirmed a previously announced deal to keep ACA preventative care rules in place while the courts decide Braidwood Mgmt. Inc. v. Becerra (Braidwood). As a reminder, the ruling stated that non-grandfathered group health plans and insurers no longer have to cover preventive services recommended by the United States Preventive Services Taskforce (USPSTF), a panel of experts in primary care and prevention, without cost sharing.

The Biden Administration appealed the Braidwood decision, which is currently under review by the Fifth Circuit Court of Appeals. The Administration also reached a deal to preserve the nationwide mandate requiring that the services recommended by USPSTF and PrEP HIV medications continue to be covered at no extra cost while the legal challenge is pending.

If you have questions about this new guidance or need any assistance with your employee benefit plans, contact your OneDigital consultant.