Jul 18, 2019

IRS Allows High Deductible Health Plans to Provide Pre-Deductible Benefits for Chronic Care Management

Glucose Monitoring Image

Earlier this week, the Internal Revenue Service (“IRS”) issued guidance expanding the list of “preventive care benefits” that a high deductible health plan (“HDHP”) may cover before a participant has met the plan’s deductible.  Preventive care benefits now include the following services and items when prescribed to treat the specified chronic conditions:

Preventive Care for Specified Conditions 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
Retinopathy screening 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

The guidance allows HDHPs to cover any or all of the expanded list of preventive care benefits pre-deductible, without negatively impacting a participant’s ability to contribute to a health savings account. Employers may amend their HDHPs immediately to account for the changes or incorporate the changes as of the start of the next plan year.

Significantly, the IRS guidance does not alter the definition of “preventive care benefits” for purposes of the Affordable Care Act’s requirement that a group health plan cover certain preventive care benefits without cost sharing. This means that an employer may choose to amend its HDHP to cover the newly designated preventive care benefits pre-deductible, but is not required to make these changes and may still subject such benefits to copays or coinsurance.

For more information about this new IRS guidance, please contact your Executive Compensation and Employee Benefits Counsel at Smith, Gambrell & Russell, LLP.