IRS Expands Preventive Care for HSAs

Good news for HSA owners! On July 17, 2019, the Treasury Department and the Internal Revenue Service (IRS) expanded the types of preventive care that can now be covered under a High Deductible Health Plan (HDHP).

HSA-qualified HDHPs cannot pay 100% of the cost for care received prior to the minimum deductible being met unless the care is classified as preventive. Under the new ruling, issued as IRS Notice 2019-45, additional medical services and products are now included in the preventive category for persons with certain chronic conditions.

Expanded Preventive Care Products and Services

Effective immediately, the following medical services and products may now be classified as preventive care under HDHP/HSA rules when used in the care of certain chronic conditions:

Preventive Care Received or Purchased

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 

Insulin and other glucose-lowering agents

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 serotonin reuptake inhibitors (SSRIs)

Depression 

Statins

Heart disease and/or diabetes 

Types of care that were previously classified as preventive for purposes of HDHP/HSA rules will continue to be treated as preventive care. In consultation with the department of Health and Human Services (HHS), Treasury and the IRS will reconsider the full list every 5 to 10 years for possible future revision.

According to Plan Sponsor, prior to now, medical care classified as preventive did not include many services or products used to treat an existing illness or condition. The agencies recognize however that due to cost considerations, some individuals fail to seek or use needed care. Failing to receive care for these chronic conditions can lead to serious consequences such as amputation, blindness, heart attacks and strokes, requiring even more extensive and costly care.

Response to Executive Order

The ruling is in part a response to the Executive Order on medical price transparency signed by President Trump in June 2019, which directed the Treasury and the IRS to consider ways to expand the use and flexibility of HSAs and HDHPs that cover low-cost preventive care. 

For more information, visit IRS.gov.


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