October 20, 2020
Since their inception, health savings accounts (HSAs) paired with high-deductible health plans (HDHPs) have increasingly been adopted by employers. Eighty-nine percent of employers responding to Business Group on Health’s 2021 Large Employers’ Health Care Strategy and Plan Design Survey will offer HSA/HDHP arrangements to employees in 2021. The HSA/HDHP design—and the rules governing that design—will continue to play a significant role in the delivery of employer-sponsored health coverage.
As employers focus on providing high-quality, evidence-based benefits and lowering the overall cost of care, they have struggled with certain limitations of the HSA rules. Specifically, employers would like to cover certain evidence-based benefits such as chronic care management and certain preventive medications before employees satisfy their deductibles. During the public health emergency due to the pandemic, HSAs paired with HDHPs can (but are not required to) cover all telehealth and other remote care services before participants satisfy deductibles from January 2020 through plan years beginning before 12/31/2021.
Additional flexibility in HSA rules would allow HSA/HDHP arrangements to deliver on the design’s underlying goals—more efficient health care purchasing and increased patient engagement in health care decisions. Specifically, we support:
- Permanent relaxation of the rules for coverage of telehealth for primary care, mental health counseling, and similar services, giving plans the option to cover them prior to meeting the HSA deductible and for people to receive these services at little to no cost sharing without jeopardize the tax-favored status of their HSA contributions;
- The ability for plans to cover chronic condition management and medications before participants satisfy their deductibles;
- The ability to cover onsite clinic services and other lower cost alternative sources of health care before employees satisfy their deductibles;
- The ability to adopt evidence-based benefit designs such as direct primary care and risk sharing models that may provide some coverage before participants satisfy their deductibles;
- Flexibility to adjust how deductibles apply to certain higher-cost items or services such as those that involve copayment assistance or copayment waivers;
- Flexibility for Medicare-eligible employees to make HSA contributions; and
- Greater transparency in health care prices relevant to plan participants, which will help employees make health care choices and decisions.
Why It Matters
- Rising health care costs continue to be a major concern for employers and employees.
- Permitting plan coverage of primary and preventive care and medications and services for management of chronic conditions prior to the deductible will prevent the need for more expensive care downstream.
- Coverage of primary care, mental health counseling, and other basic services offered through telehealth, onsite clinics, and other lower cost sites of care will help reduce health care costs for employers and employees.
- HSA funds, including employer contributions, help employees and their families afford their out-of-pocket health care expenses and save for future health care needs, including for retiree health expenses.