Individuals who are covered by an HDHP generally may establish and make contributions to a health savings account (HSA). To qualify as an HDHP, the plan cannot provide benefits for any year until a minimum deductible is satisfied. However, an HDHP may provide benefits for preventive care without imposing a deductible.
IRS Notice
2019-45 classifies certain medical care services and items, including prescription drugs, for
chronic conditions as preventive care for individuals with those chronic
conditions.
ACTION STEPS
This guidance makes it easier for HDHP participants to receive benefits
for medications and other care to treat their chronic conditions. Employers
with HDHPs should review their plan documents and consult with their carriers
and benefit administrators, if necessary, to determine how their plans cover
preventive care benefits.
HDHP – Preventive Care
To be eligible to establish an HSA and make contributions,
an individual must be covered under an HDHP and have no disqualifying health coverage.
An HDHP is a health plan that satisfies requirements for minimum deductibles
and out-of-pocket maximums.
Except for preventive care benefits, no benefits can be paid
by an HDHP until the minimum annual deductible has been satisfied. An HDHP may
apply a low deductible (or no deductible) to its coverage of preventive care.
The IRS has provided guidance on permissible preventive care
benefits for HDHPs. These benefits include, for example, periodic health exams
(such as annual physicals), routine prenatal and well-child care, immunizations
and screening devices and tests (such as cancer screenings).
As a general rule, preventive care generally does not
include any service or benefit intended to treat an existing illness, injury or
condition. For cost reasons, individuals with chronic conditions may not obtain
necessary medical care, leading to consequences that require considerably more
extensive medical intervention (for example, amputation, blindness, heart
attacks and strokes).
Executive Order
On June 27, 2019, President Donald Trump signed an executive
order aimed at improving price and quality transparency in health care. The
order directs federal agencies to issue guidance in several areas regarding
health care costs. Specifically, the executive order directs the Treasury Department
and IRS to expand the ability of patients to select HSA-compatible HDHPs that
cover low-cost preventive care, before the deductible, that helps maintain
health status for individuals with chronic conditions. The IRS issued Notice
2019-45 in response to this executive order.
Expanded Preventive Care for Chronic Conditions
Notice 2019-45 provides that certain medical care services and items, including prescription drugs, for certain chronic conditions should be classified as preventive care under the HDHP rules for individuals with those chronic conditions. These medical services and items are limited to the ones listed below for individuals with the corresponding conditions:
Preventive care for specified conditions
|
For individuals diagnosed with
|
|
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
|
|
Inhaled corticosteroids
|
Asthma
|
|
Peak flow meter
|
|
|
Insulin and other glucose-lowering agents
|
Diabetes
|
|
Retinopathy screening
|
|
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Glucometer
|
|
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Hemoglobin A1c testing
|
|
|
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
|
These additional services and items are treated as
preventive care only when prescribed to treat an individual with the specified
chronic condition, and only when prescribed to prevent the exacerbation of the
chronic condition or the development of a secondary condition.
If an individual is diagnosed with more than one chronic
condition, all listed services and items applicable to the two or more
conditions are preventive care. However, services and items not listed above
that are for secondary conditions or complications that occur are not considered
preventive care for HDHP purposes.
In addition, Notice 2019-45 clarifies that its guidance does
not impact the definition of preventive care under the Affordable Care Act
(ACA). Under the ACA, non-grandfathered health plans must cover specific
preventive care services without any participant cost-sharing.
Source: Zywave, 2019.
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