Compliance Alert: IRC 213(d) Expenses and Preventive Care Update
Senior Compliance Attorney
On October 17, 2024, the IRS issued two notices regarding reimbursable expenses under FSAs, HRAs and HSAs and preventive care benefits in relation to HSA compatible High Deductible Health Plans (HDHPs).
Condoms are now classified as “medical care” under IRC 213(d). This means they are reimbursable through FSAs, HRAs, and HSAs.
The list of preventative care items and services that can be covered by an HSA-compatible HDHP before meeting the deductible has been expanded. These items and services include:
- Over-the Counter (OTC) oral contraceptives, including emergency contraceptives, and male condoms.
- All breast cancer screenings for individuals without a breast cancer diagnosis.
- Continuous glucose monitors for individuals diagnosed with diabetes.
- Insulin products, regardless of whether they are prescribed to manage diabetes, prevent complications from diabetes or for the development of a secondary condition.
All these items and services can be covered before the HDHP deductible is met and will not prevent an otherwise eligible individual from contributing to their HSA.
The guidance is effective for plan years beginning on or after December 31, 2022
(retroactive application to 2023 plan years and future plan years).
The information provided is a summary of laws and regulations relating to employee benefit plan compliance. This information should not be construed as legal advice. In all cases, employers should consult with their own legal counsel.
