COVID-19 Testing & Treatment: HSA/HDHPs Can Provide Pre-Deductible Coverage

New IRS notice permits health savings accounts (HSAs) paired with high-deductible health plans (HDHPs) to cover COVID-19 testing and treatment before participants satisfy their deductibles.

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In response to the coronavirus disease known as COVID-19, the Internal Revenue Service (IRS) has issued Notice 2020-15, which permits health savings accounts (HSAs) paired with high-deductible health plans (HDHPs) to cover COVID-19 testing and treatment before participants satisfy their deductibles. Specifically:

  • HSA/HDHPs can cover COVID-19 testing and treatment without a deductible or a deductible that is lower than the minimum self-only or family deductibles (in 2020, $1,400 for self-only and $2,800 for family).
  • This guidance applies to “all medical care services and items purchased associated with testing for and treatment of COVID-19.”
  • The IRS also notes that vaccinations continue to be considered “preventive” under the HSA rules. Therefore, if a COVID-19 vaccine becomes available, HSA/HDHPs will be able to provide pre-deductible coverage.

Next Steps

We recommend that employers offering HSAs paired with HDHPs:

  • Work with their health plan or TPAs to determine how copays, deductibles, or other cost-sharing will apply to COVID-19 testing and treatment;
  • Amend plan documents and other disclosures as needed; and
  • Determine how plans will communicate any plan changes to participants.

Resources

Webinar

The Business Group hosted a webinar on Tuesday March 17, 2020 during which we discussed this and other regulatory developments for group health plans. Members can access the slides and recording at our Events page.

More Topics

Policy & Advocacy icon_right_chevron_dark Emergency Preparedness and Response icon_right_chevron_dark Health Accounts icon_right_chevron_dark COVID-19 icon_right_chevron_dark