Why are Carriers Doing This? The government, insurance carriers, and the general public alike care that people have health insurance in this difficult time, especially in the middle of a public health crisis. Carriers are offering this in response to the crisis, which then allows employers to meet the needs of employees.
Benefits Not Subject to Section 125 Rules
Employee HSA Contributions Pre-tax HSA contributions may be changed at any time. This is an often-misunderstood feature of the HSA rules because it deviates from the general requirements for most pre-tax elections. Commuter Benefits Pre-tax commuter benefits for parking or transit may be changed on a prospective basis (typically monthly). Notably, employees are likely no longer incurring work-related parking and transit expenses. Therefore it will be important for them to manage their accounts carefully. Elections may be changed to zero, but refunds of already contributed monies are not permitted (even on a taxable basis). Any amounts contributed previously will remain available for future use when commuting expenses resume.
Safe Harbor for HDHP/HSAs
Free COVID-19 Testing The addition of free coverage for COVID-19 testing and related services will not compromise the qualification of an HDHP plan. This confirmation is important because it allows plan participants to continue to contribute to an HSA without fear that the HSA contribution will be disqualified. First Dollar Telehealth Benefits The absence of a deductible for telehealth and remote care services will not negatively impact the qualified status of a High Deductible Health Plan. HSA Contributions Protected These two provisions allow employees covered under an HDHP to continue contributing to their HSA without fear that contributions will be disqualified.
Guidance for Insurers Although the OCR’s HIPAA telehealth enforcement relief does not apply to health insurers, the Centers for Medicare and Medicaid Services (CMS) has issued separate guidance encouraging insurers to promote the use of telehealth services. This would include notifying policyholders (employers) and participants (employees) of the availability of telehealth services, ensuring access to a robust suite of telehealth services (including mental health and substance use disorder services), and covering telehealth services without cost-sharing or other medical management requirements.
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