On December 21, 2024, the American Relief Act 2025, a year-end government spending bill, was signed into law. While released drafts of the bill included provisions providing relief that would have allowed high-deductible health plans (HDHPs) to provide pre-deductible coverage for non-preventive telehealth services, this relief was not included in the final version of the spending bill. A previous alert on telehealth relief extensions is included below for reference.

• Extension of telehealth relief for HDHPs will not be available for plan years starting on or after January 1, 2025, unless further legislation is passed prior to that date extending the relief or making it permanent.
• Plan sponsors should assume that telehealth relief will not be available for their 2025 plan years, and should ensure that HDHP participants are charged the fair market value for any non-preventive telehealth/remote care services received before the participant has satisfied the plan’s deductible.

HDHP Telehealth Relief Extension (originally sent December 19, 2024)

This week, Congress released the Further Continuing Appropriations and Disaster Relief Supplemental Appropriations Act, 2025, which extends by two years telehealth relief for HSA-qualified high deductible health plans (HDHPs). This pending legislation is expected to pass by the end of this week or early next week.

Relief allowing HDHPs to cover non-preventive telehealth on a pre-deductible basis was first implemented in 2021 as part of COVID relief legislation; the relief was then extended twice, with the most recent extension previously set to expire at the end of 2024. A previous alert on HDHP telehealth relief is included below for reference.

• The previous relief applied to any HSA-eligible HDHP with a plan year start date on or before December 31, 2024.
• The current relief will apply to any HSA-eligible HDHP with a plan year start date on or before December 31, 2026.
• HDHPs that are currently covering telehealth on a pre-deductible basis may continue to do so until at least the end of their 2026 plan year.

HDHP Telehealth Relief Extension (originally sent January 2023)

As 2022 drew to a close, Congress passed the $1.7 trillion 2023 Consolidated Appropriations Act (CAA 2023), avoiding a government shutdown. Among the bill’s 4,000+ pages was a provision renewing previous relief that allowed high-deductible health plans (HDHPs) to waive the deductible on telehealth and other remote care services without jeopardizing participants’ HSA eligibility. Due to changes in the way telehealth relief has been implemented over multiple years, plan sponsors should carefully consider the implications of the relief for their particular plans.

Background

• Telehealth relief was first offered in response to COVID-19 via the CARES Act of 2021. The CARES Act allowed HDHPs to offer first-dollar coverage of telehealth for the 2020 and 2021 plan years.
• The 2022 Consolidated Appropriations Act (CAA 2022) provided limited telehealth relief between April 1, 2022 and December 31, 2022. It is important to note that the telehealth relief in CAA 2022 was based on calendar months, not plan years; thus, all plans, regardless of their plan years, were only able to provide first-dollar telehealth coverage during the applicable months.
• The 2023 CAA once again allows for first-dollar telehealth coverage based on the plan year. Specifically, such coverage can be offered for the duration of any plan year beginning after December 31, 2022 and before January 1, 2025 (i.e., any plan year beginning in calendar years 2023 and 2024).

Telehealth Relief Plan Year Gaps

• Because of the differences in how these laws have structured telehealth relief, most plans would have experienced – or will experience – gaps in their ability to waive the deductible on telehealth. See the table below for sample scenarios:

*Because the CARES Act was passed in March of 2020, its provision regarding telehealth relief effectively applies to 2020 and 2021 plan years

• During the “gap months,” the deductible must be applied to non-preventive telehealth services in order to ensure that participant HSA eligibility is not impacted.

2023 CAA Telehealth Relief

• Non-calendar year HDHP plans must wait until the start of their next plan year after January 1, 2023 before offering first-dollar telehealth coverage; such coverage may continue through the end of the 2024 plan year, even if the plan year continues into 2025.
• As was true for the telehealth relief offered under the CARES Act and CAA 2022, the relief offered under CAA 2023 is optional. High-deductible health plans may, but do not have to, offer first-dollar telehealth coverage; doing so will not impact participants’ HSA eligibility.
• Plans that choose to newly implement first-dollar telehealth coverage should ensure that the change is communicated to participants and that plan documents are updated to reflect the change.