IRS Expands Coverage For Preventative Care of Chronic Conditions For HSA Eligible Individuals

A high deductible health plan (HDHP) generally may not provide benefits for any year until the minimum deductible for that year is satisfied. However, the HSA law provides a safe harbor permitting an HDHP to provide preventive care benefits without a deductible.

In June, President Trump issued Executive Order 13877 directing, among other things, the Secretary of Treasury to expand the ability of patients to select HDHPs that can be used alongside an HSA, and that cover low-cost preventive care before the deductible, to help maintain health status for individuals with chronic conditions.

In response, last month the Treasury Department issued IRS Notice 2019-45 which

expands the list of preventive care benefits permitted to be provided by a HDHP without a deductible, or with a deductible below the applicable minimum HDHP deductible for individuals with certain chronic conditions. The newly listed medical services and items now classified as preventive care are limited to the specific medical care services or items listed in the Notice for the associated chronic conditions specified in the Notice.

These specified services and items are treated as preventive care only when:

• prescribed to treat an individual diagnosed with the associated chronic condition specified in the Notice, and
• prescribed for the purpose of preventing 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 in the Notice that are for secondary conditions or complications that occur notwithstanding the preventive care are not treated as preventive care.

These new preventive services and associated chronic conditions are as follows: