With the issuance of Notice 2019-45 on July 17, 2019, the Treasury Department and the Internal Revenue Service (IRS) have expanded the types of preventative care that can now be covered under a High Deductible Health Plan (HDHP) for people with certain chronic conditions.
Under IRS code section 223(c)(2), HSA-qualified HDHPs cannot pay 100% of the cost for care received prior to the minimum deductible being met unless the care is classified as preventive. Created in 2005, Health Savings Accounts (HSAs) are available for individuals who are enrolled in a qualified HDHP and have no other, disqualifying health coverage.
Expanded Preventative Care Products and Services
Effective immediately, Notice 2019-45 lists certain medical services and products, including prescriptions, used in the care of certain chronic conditions that may now be classified as preventive care under HDHP/HSA rules. These include:
|Angiotensin converting enzyme (ACE) inhibitors||Congestive heart failure, diabetes, and/or coronary artery disease|
|Anti-resorptive therapy||Osteoporosis and/or osteopenia|
|Beta-blockers||Congestive heart failure and/or coronary artery disease|
|Blood pressure monitor||Hypertension|
|Insulin and other glucose-lowering agents||Diabetes|
|Peak flow meter||Asthma|
|Hemoglobin A1c testing||Diabetes|
|International Normalized Ratio (INR) testing||Liver disease and/or bleeding disorders|
|Low-density lipoprotein (LDL) testing||Heart disease|
|Selective serotonin reuptake inhibitors (SSRIs)||Depression|
|Statins||Heart disease and/or diabetes|
Any other medical care previously recognized as preventive care for purposes of HDHP/HSA rules is still treated as preventive care. In consultation with the department of Health and Human Services (HHS), Treasury and the IRS will review the full list every 5 to 10 years to make additions or deletions.
According to Plan Sponsor, in prior guidance preventive care generally did not include any service or benefit intended to treat an existing illness, injury, or condition. However, the agencies say they are aware that the cost for care has been an issue for some people; due to affordability, some individuals fail to seek or use necessary care that would prevent worsening of their condition. Failing to get care for these chronic conditions has lead to serious consequences, such as amputation, blindness, heart attacks and strokes; often, the consequences require even more extensive and costly medical intervention.
Ruled Changed Due to Executive Order on Medical Price Transparency
This rule change is made pursuant to the Executive Order on medical price transparency signed by President Trump in June. Under the Executive Order, Treasury and the IRS were directed to consider ways to expand the use and flexibility of HSAs and HDHPs that cover low-cost preventive care.
For more information, visit IRS.gov or contact your benefits administrator.
DataPath, Inc. creates technology solutions for the administration of Health Savings Accounts and other consumer directed healthcare benefits.