Irs Grants Relief For Covid-19 Testing And Treatment For High Deductible Health Plans

On March 11, amid growing concerns surrounding the 2019 Novel Coronavirus (COVID-19), the IRS published relief for high deductible health plans (HDHP) and health savings accounts (HSA).  The IRS’s relief provides that a high deductible health plan (HDHP) that is otherwise qualified under the Internal Revenue Code will continue to be qualified if it offers treatment and testing for COVID-19 without a deductible (or with a deductible below the minimum deductible required for an HDHP).  The IRS also specified that if a vaccine becomes available for COVID-19, as preventive care, it can be provided to participants with minimal or no cost-sharing obligation, even before the high deductible is satisfied, without causing a loss of HDHP or HSA eligibility.

With this relief, the IRS seeks to remove barriers for testing for and treatment of COVID-19.  Ultimately, this permits individuals participating in an HDHP with an HSA to use HSA funds for COVID-19 treatment and testing without having to first pay a deductible (or only paying a low deductible).

Employers looking to take advantage of this relief should consider amending their HDHP to provide for free or low-cost COVID-19 testing and/or treatment.