Employers and health plans that want to provide some relief for participants during the spread of the novel coronavirus (SARS-CoV-2, which causes the disease COVID-19) may waive deductibles for COVID-19 testing without violating IRS high deductible health plan (HDHP) rules.  Early this week, the IRS published guidance allowing high deductible health plans to pay COVID-19 test expenses without disqualifying their programs for high deductible health plan treatment under the Code. The stated relief is set forth in IRS Notice 2020-15.

The Notice provides that, until further guidance is issued, a health plan that otherwise satisfies the requirements to be an HDHP under Code section 223(c)(2)(A) will not fail to be an HDHP merely because the health plan provides health benefits associated with testing for and treatment of COVID-19 without a deductible, or with a deductible below the minimum deductible (self only or family). In addition, the guidance indicates that individuals covered by the HDHP will not be disqualified from making tax-favored contributions to a health savings account (HSA).

Employers and other health plan sponsors that want to waive the deductible should consider whether any amendments to their health plan documents, employee communications, and vendor service agreements are necessary. 

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