America's Benefit Specialist May 2023

THE END OF COVID EMERGENCIES

from both in-network and out-of-network providers. When the emergency is lifted, plans must still cover COVID vaccines at no cost to the individual, from in-network providers. Employers will have to decide whether their plans will cover COVID vaccines from out-of-network providers. If so, em ployers will have to decide whether the plan will pay for the vaccine before the individual has met the deductible and whether the individual will be required to pay any portion of the cost. Because the vaccine constitutes preventive care, an HDHP (see the text box) may continue to cover out-of-net work vaccines before the individual has met the deductible, without jeopardizing the individual’s HSA eligibility. In order to be eligible to contribute to a Health Savings Account, an individual must be covered by a high-deductible health plan. The main feature of an HDHP is that, as a general rule, the plan cannot pay for any benefits until the individual has met the deductible. There is a narrow exception for preventive care, which includes certain immunizations. Testing: For the duration of the public health emergency, plans must cover COVID testing at no cost to the individual, from both in-network and out-of-network providers. When the emergency is lifted, plans will no longer be required to cover COVID testing at all. Employers will have to decide whether their plans will cover the tests, whether the cov erage will be only in-network or also out-of-network, and whether individuals will share in the cost. What about HDHPs? Early in the pandemic, the IRS an nounced that “until further notice,” when an HDHP covered COVID testing before the individual met the deductible, the coverage would not jeopardize the individual’s HSA eligibility. As of this writing, the IRS has not announced an expiration date for this relief. Employers with HDHPs will want to watch carefully for that announcement. They must ensure that COVID testing is subject to the deductible as of the expira tion date. (There is one caveat: COVID testing might be con sidered a screening—thus preventive care—in which case it could still be covered before the HDHP deductible. Ideally, the IRS would make some announcement in this regard. In the absence of such an announcement, employers will need to consult their benefit advisors and make their own determinations.) Treatment: Plans are not required to cover treatment of COVID, though most do. During the early days of the pandemic, many plans waived all cost-sharing for COVID treatment—plans covered COVID treatment without re quiring individuals to pay the deductible, a copayment or coinsurance. Even HDHPs waived cost-sharing because the IRS announced that “until further notice,” HDHPs could do so without jeopardizing the individual’s HSA eligibility. As stated above, the IRS has not yet provided “further notice” or an ex piration date for this relief. When the relief expires, employers

with HDHPs must ensure that COVID treatment is subject to the deductible. TELEHEALTH BENEFITS The Coronavirus Aid, Relief and Economic Security Act was adopted in March 2020 in response to the pandemic. Under the CARES Act, HDHPs are temporarily permitted to cover telehealth visits before the individual has met the deduct ible without jeopardizing the individual’s HSA eligibility. This relief was extended by later legislation and remains available even after the emergencies are lifted. Specifically, HDHPs may continue waiving the deductible for telehealth until the end of the plan year (see text box) that begins in 2024. Employers with HDHPs must ensure that telehealth visits are subject to the deductible no later than that date. For employers whose HDHP has a plan year that is the same as the calendar year, telehealth visits must be subject to the deductible as of January 1, 2025. What is the plan year? For major medical plans covered by ERISA, the “plan year” is generally desig nated in the plan document. If there is no plan docu ment, or if there is no designation, then the plan year is the deductible year used under the plan. If the plan does not impose a deductible, then the plan year is the insurance policy year. If the plan does not impose a deductible, and either the plan is not insured or the insurance policy is not renewed on an annual basis, then the plan year is the employer’s taxable year. In any other case, the plan year is the calendar year. STAND-ALONE TELEHEALTH PLANS Two forms of relief are currently in place. First, a large em ployer 3 may offer a plan that provides only telehealth services and only to employees who are not eligible for coverage under any other group health plan offered by the employer. Second, these stand-alone telehealth plans do not jeopardize an individual’s HSA eligibility. This relief expires at the end of the plan year in which the public health emergency is lifted. Employers with stand-alone telehealth plans should ensure that the plans terminate on or before that date. For employ COVID TESTING MIGHT BE CONSIDERED A SCREENING—THUS PREVENTIVE CARE—IN WHICH CASE IT COULD STILL BE COVERED BEFORE THE HDHP DEDUCTIBLE.

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