IRS Issues Guidance on COVID-19 Relief for HDHPs


HSA-qualifying high-deductible health plans (HDHPs) will no longer be allowed to cover COVID-19 testing and treatment before the HDHP deductible is satisfied (or at least the statutory minimum deductible).

The IRS has released Notice 2023-37, in response to the end of the COVID-19 public health emergency and the national emergency, clarifying that HDHPs may not cover COVID-19 testing and treatment before the deductible is met for plan years ending after December 31, 2024.  This Notice modifies prior guidance that allowed HDHPs to cover COVID testing and treatment before the minimum annual deductible is satisfied.  Therefore, a calendar-year HDHP may continue such coverage until January 1, 2025, but a non-calendar-year HDHP must apply the deductible to COVID testing and treatment as of the first day of the 2024 plan year.  For example, an HDHP with a plan year of 8/1 – 7/31 must apply the deductible beginning with the 8/1/24 – 7/31/25 plan year.

Items or services that qualify as preventive care may be covered under an HDHP without cost sharing before the deductible is met if they qualify as preventive care under the Affordable Care Act.  Individuals covered under such an HDHP will be eligible to contribute to an HSA.  Notice 2023-37 states that COVID testing is not considered preventive care under this safe harbor as of the date the notice was published (June 23, 2023).

ASR will ensure all client plan materials are updated and amended to account for the guidance detailed in this Notice.

Contact ASR Health Benefits at (616) 957-1751 or (800) 968-2449 for more information on this guidance.