HDHP Telehealth Provision Extended Into 2023 and Beyond
On December 29, 2022, President Joe Biden signed the Consolidated Appropriations Act, 2023 (CAA 2023) into law. The law includes a provision which extends the ability of high deductible health plans (HDHPs) to allow telehealth and other remote care services without cost sharing (first dollar coverage).
Prior to the enactment of CAA 2023, HDHPs’ ability to provide first dollar coverage of telehealth and remote services was set to expire at the end of 2022. Allowing for first dollar coverage of telehealth and remote services was originally allowed for in the CARES Act and extended in March of 2022.
Under this extension, employers sponsoring HDHPs with plan years beginning after December 31, 2022, and before January 1, 2025, may choose to waive the deductible for telehealth and remote services without causing HDHP participants to lose their ability to contribute to a health savings account (HSA).
It should be noted that for non-calendar year plans, there will be a gap in coverage from the end of 2022 until the start of their 2023 plan year as the extension applies to “plan years beginning after December 31, 2022.” During this gap, telehealth and remote services must be counted towards the deductible for participants to maintain their HSA eligibility.
Allowing first dollar coverage for telehealth and remote services is optional for employer-sponsored health plans. This means it is up to the HDHP plan sponsor to decide if they want to offer telehealth and remote services with first dollar coverage or if they wish to apply the deductible requirement.
Plan sponsors of HDHPs will need to determine if they want to allow first dollar coverage for telehealth and other remote care services for plan years that begin after December 31, 2022, and before January 1, 2025.
HDHP plan sponsors who wish to implement first dollar coverage for telehealth and remote services would be well served to work with their insurance partners to make those changes.