HSA/HDHPs Can Now Provide Pre-Deductible Coverage for Insulin and Other Chronic Condition Treatments

The IRS issued Notice 2019-45, which permits (but does not require) HSA/HDHP arrangements to cover certain chronic condition treatments before participants satisfy their deductibles.

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Recently, the Internal Revenue Service (IRS) issued Notice 2019-45, which permits (but does not require) HSA/HDHP arrangements to cover certain chronic condition treatments before participants satisfy their deductibles. Below are details that will be relevant to plan sponsors.

Notice 2019-45, provides that HDHPs paired with HSAs can reimburse the following chronic condition treatments, provided they are prescribed for their corresponding conditions:

HSA/HDHPs and Chronic Condition Treatments

Preventive Care for Specific Conditions For Individuals Diagnosed with
Angiotensin Converting Enzyme (ACE) inhibitors Congestive heart failure, diabetes, and/or coronary artery disease
Anti-resoprtive therapy Osteoporosis and/or osteopenia
Beta-blockers Congestive heart failure and/or coronary artery disease
Blood pressure monitor Hypertension
Inhaled corticosteroids Asthma
Insulin and other glucose lowering agents Diabetes
Retinopathy screening Diabetes
Peak flow meter Asthma
Glucometer Diabetes
Hemoglobin A1c testing Diabetes
International Normalized Ratio (INR) testing Liver disease and/or bleeding disorders
Low-density Lipoprotein (LDL) testing Heart disease
Selective Sertonin Reuptake Inhibitors (SSRIs) Depression
Statins Heart disease and/or diabetes

Plan sponsors interested in implementing this pre-deductible coverage should note the following:

  • The chronic condition treatments listed above are the only ones currently permitted under the HSA rules. The IRS will review and update this list approximately every 5-10 years and will continue considering standards for preventive care.
  • HSA/HDHP arrangements can continue providing pre-deductible coverage for current preventive items/services such as annual well visits and immunizations.
  • HSA/HDHP arrangements generally can require cost-sharing for the above items/services but cannot require cost-sharing if they overlap with ACA preventive services such as statins.

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