IRS Says High-Deductible Health Plans Can Cover Coronavirus Costs

The IRS announced on March 11 that high-deductible health plans (HDHPs) can pay for 2019 Novel Coronavirus (COVID-19)-related testing and treatment without jeopardizing their qualified status. This also means that an individual with an HDHP that covers these costs may continue to contribute to a health savings account (HSA).   

 

The IRS made the announcement in Notice 2020-15. The Notice says that health plans that otherwise qualify as HDHPs will not lose that status just because they cover the cost of testing for or treatment of COVID-19 before plan deductibles have been met. The IRS also noted that, as in the past, any vaccination costs continue to count as preventive care and can be paid for by an HDHP.

The IRS does include a caveat: Notice 2020-15 applies only to HSA-eligible HDHPs. The IRS cautions that employees and other taxpayers in any other type of health plan with specific questions about their own plan and what it covers should contact their plan.