New Rules Widen Definition of “Preventive Care”

Earlier this month, the Internal Revenue Service (IRS) expanded the list of preventive care benefits for certain chronic conditions that would apply for patients with high-deductible health plans (HDHPs).

As a result, individuals enrolled in HDHPs can receive first-dollar coverage for these items or services without endangering their eligibility to contribute to health savings accounts (HSAs), according to Notice 2019-45 (the "Notice").

HDHP Rule Refresher: To qualify as a HDHP (and therefore preserve a participant’s ability to contribute to an HSA), a plan generally may not provide benefits until the deductible is satisfied. However, preventive care benefits may be provided before a participant has met his or her deductible.

This is welcome news for plan sponsors that have wanted to expand access to certain wellness-related services that previously did not meet the definition of “preventive care” under HDHPs. Covering the specified items or services prior to the deductible may ultimately reduce plan costs, by removing barriers for individuals with chronic (and in many cases, expensive) conditions to seek care earlier on in the disease process - e.g., A1c testing for individuals with diabetes and LDL testing for individuals with heart disease.

There are a few important caveats to keep in mind with this Notice:

• The items and services specified by the IRS are considered preventive care only when prescribed (i) to treat an individual diagnosed with the specified chronic condition and (ii) for the purpose of preventing the exacerbation of the chronic condition or the development of a secondary condition. Items and services not listed that are for secondary conditions or complications of the chronic condition are not considered to be preventive care.
• The items and services are limited to the care for the chronic condition specified in the Notice. For example, if an individual does not have hypertension, a blood pressure monitor would not fall within the definition of preventive care.
• Inclusion on this list does not mean that the item or service must be provided without cost-sharing under the Affordable Care Act preventive care rules (section 2713 of the PHS Act). However, a plan sponsor could voluntarily choose to provide coverage for these items or services without cost-sharing.

The IRS’ list of new preventive services (and the associated conditions) is below: