Congress Extends Telehealth

March 27, 2023

Congress Extends Pre-Deductible Telehealth Coverage for High-Deductible Health Plans (HDHPs): Benefits and Impact on Plan Deductibles and HSA Contributions

On December 29, 2022, the Consolidated Appropriations Act, 2023 (CAA) was signed into law, providing an extension of the ability of high deductible health plans (HDHPs) to offer Telehealth or other remote care services before plan deductibles have been met. The best part is that this extension will not jeopardize health savings account (HSA) eligibility. This benefit will apply for plan years beginning after December 31, 2022, and before January 1, 2025.

The eligibility for HSA contributions depends on the fact that individuals should not be covered under a health plan that provides benefits except for preventive care benefits, before the minimum HDHP deductible is satisfied for the year. As a result, tele health programs that provide free or reduced-cost medical benefits before the HDHP deductible is satisfied are disqualifying coverage for HSA eligibility. 

However, since January 1, 2020, the CARES Act allowed HDHPs to offer benefits for Telehealth or other remote care services before plan deductibles were met. This relief applied for plan years beginning before January 1, 2022. A spending bill extended this relief to Telehealth services provided in months beginning after March 31, 2022, and before January 1, 2023. The CAA has further extended this first-dollar coverage for Telehealth services to plan years beginning after December 31, 2022, and before January 1, 2025.

The impact of this extension is significant as HDHPs may choose to waive the deductible for any Telehealth services for plan years beginning in 2023 and 2024 without causing participants to lose HSA eligibility. This provision is optional, and HDHPs can continue to choose to apply any Telehealth services toward the deductible. However, there is a gap for non-calendar-year plans from January 1, 2023, when the spending bill’s extension expired, to the start of the 2023 plan year. This means that during this time, this temporary relief for Telehealth services will not apply.

In conclusion, the extension of pre-deductible Telehealth coverage for HDHPs is a significant benefit for those who rely on Telehealth services. It also has a positive impact on plan deductibles and HSA contributions, providing an opportunity to waive deductibles for Telehealth services without losing HSA eligibility.

Brought to you by the insurance professionals at Custom Benefit Consultants, Inc.

Blog Tags:

Telehealth, benefits, plan deductibles, HSA contributions, HDHPs