High-deductible health plans can cover Coronavirus costs

The Internal Revenue Service (IRS) advised yesterday that high-deductible health plans (HDHPs) can pay for 2019 Novel Coronavirus (COVID-19)-related testing and treatment, without jeopardizing their status. This also means that an individual with an HDHP that covers these costs may continue to contribute to a health savings account (HSA).

In Notice 2020-15, posted today on IRS.gov, the IRS confirmed that health plans that otherwise qualify as HDHPs will not lose that status merely because they cover the cost of testing for or treatment of coronavirus/COVID-19 before deductibles have been met. Also, as in the past, any vaccination costs continue to count as preventive care and can be paid for by an HDHP.

The list of qualifying expenses is updated as the popularity of HSAs and HDHPs expands. Last year, the Internal Revenue Service (IRS) added 14 items and services for a range of chronic conditions to the list of preventive care benefits that may be covered.

Today’s notice applies only to HSA-eligible HDHPs. Employees and other taxpayers in any other type of health plan with specific questions about their own plan and what it covers should contact their plan.

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