HSA Eligibility: IRS Lists Additional Preventive Care Items for Those with Chronic Conditions

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On Wednesday, July 17, the Internal Revenue Service (IRS) released a notice that names additional medicines and services that can be treated as preventive care and qualify for HSA eligibility under high deductible health plans (HDHPs) for those with chronic conditions.

This Notice (Notice 2019-45) follows a directive by President Trump in a recently released executive order, directing the IRS to provide guidance on how HDHPs could be designed to provide low-cost chronic condition management before the deductible, while also maintaining HSA eligibility. The IRS has identified the following list of chronic condition management items that are specifically prescribed to prevent the exacerbation of the chronic condition or the development of a secondary condition:

Preventive Care for Specified ConditionsFor Individuals Diagnosed with
Angiotensin Converting Enzyme (ACE) inhibitorsCongestive heart failure, diabetes, and/or coronary artery disease
Anti-resorptive therapyOsteoporosis and/or osteopenia
Beta-blockersCongestive heart failure and/or coronary artery disease
Blood pressure monitorHypertension
Inhaled corticosteroidsAsthma
Insulin and other glucose lowering agentsDiabetes
Retinopathy screeningDiabetes
Peak flow meterAsthma
GlucometerDiabetes
Hemoglobin A1c testingDiabetes
International Normalized Ratio (INR) testingLiver disease and/or bleeding disorders
Low-density Lipoprotein (LDL) testingHeart disease
Selective Serotonin Reuptake Inhibitors (SSRIs)Depression
StatinsHeart disease and/or diabetes

The IRS states “services and items not listed in the Appendix (list above) that are for secondary conditions or complications that occur notwithstanding the preventive care are not treated as preventive care for purposes of section 223(c)(2)(C).”

That language appears to indicate that the IRS views the above list as the only services, prescriptions, or items that exhibit the characteristics outlined below that the IRS has identified as evidencing ability to be treated as preventive care under an HDHP:

  • The service or item is low cost;

  • There is medical evidence supporting high cost efficiency of preventing exacerbation of the chronic condition or the development of a secondary condition; and

  • There is strong likelihood that this service or use of the item will prevent the exacerbation of the chronic condition or the development of a secondary condition that requires significantly higher cost treatments.

However, the IRS states it will consult with the Department of Health and Human Services on a periodic basis to review the list and determine if services or items should be added or removed.

By |2019-07-18T16:46:23-05:00July 18th, 2019|Brokers, Employer Posts, HSAs, Legislation, News|
Disclaimer: ConnectYourCare does not provide tax or legal advice. This information is not intended and should not be taken as tax or legal advice. Any tax or legal information in this notice is merely a summary of ConnectYourCare’s understanding and interpretation of some of the current tax regulations and is not exhaustive. You should consult your tax advisor or legal counsel for advice and information concerning your particular situation before making any decisions.