The Consolidated Appropriations Act, 2022 (CAA) was signed into law on March 15, 2022 to avoid a government shutdown and includes a provision that reinstates relief for coverage of telehealth care under a high-deductible health plan (HDHP). The reinstatement is not mandatory. But if an employer decides to implement this relief, their HDHP participants can receive non-preventive telehealth/telemedicine and other remote care services without satisfying the HDHP’s deductible, and still maintain health savings account (HSA) eligibility – but only from April 1 – December 31, 2022.

This time period is important because similar relief was permitted under the Coronavirus Aid, Relief and Economic Security Act (CARES Act) for plan years that began before January 1, 2022. So depending on the HDHP’s plan year start date, there could be a gap during which telehealth services must be subject to the deductible for HSA purposes.

Specifically, a HDHP with a 2022 plan year that begins January 1, February 1, or March 1 must apply the deductible to non-preventive telehealth services provided January 1 – March 31, 2022, for the period of time included in the plan year.

 

Examples:

  • calendar year plan must apply the deductible to services provided January 1 – March 31, 2022.
  • A HDHP with a plan year that begins February 1 only applies the deductible for services provided February 1 – March 31, 2022.

 

A HDHP with a plan year that begins on or after April 1, 2022 that provided the relief under their 2021 plan (per the CARES Act) would not have this gap.

As a reminder, regardless of plan year dates, the relief does not extend to services provided after December 31, 2022.

See also  2021 ACA Reporting Instructions Issued

 

Employer Next Steps

Employers that provide telehealth/telemedicine and other remote care benefits to HDHP participants and wish to adopt this temporary relief must work with their insurer (including stop-loss carrier, if self-insured) and/or third-party administrator to amend their policy/plan document and communicate the relief to participants in a Summary of Material Modification (SMM) or updated Summary Plan Descriptions (SPD).

An employer with a HDHP that renews soon (or began/renewed earlier this year) should proceed immediately with next steps to adopt this change prospectively for an April 1 effective date.

We will continue to monitor developments relating to this issue including any guidance regarding potential retroactive application to periods prior to April 1, 2022, and will provide updates as needed.

For more information on telemedicine’s impact on HSA eligibility, see our bulletin below.

 

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This blog and its contents are not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.