New Guidance Will Help HSA Participants Save on Chronic Conditions

July 24, 2019

Participants in High-Deductible Health Plans (HDHPs) and Health Savings Accounts (HSAs) will be able to save on treatments related to a number of chronic conditions while maintaining their HSA eligibility, thanks to a guidance recently issued by the IRS and the U.S. Department of the Treasury.

What does the guidance mean?

IRS Notice 2019-45 states that, starting in 2020, certain expenses for care of chronic conditions will be considered preventive care for participants enrolled in HDHPs and HSAs. That means these expenses will be eligible to be covered by insurance, even before participants reach their required HSA deductible.

Currently, HDHP/HSA participants have to pay for these types of expenses out of pocket if they haven’t hit their required HSA deductible.

What expenses were re-classified?

The following preventive-care expenses can be covered by insurance starting in 2020:

Expense covered

For individuals diagnosed with:

Angiotensin Converting Enzyme (ACE) inhibitors

Congestive heart failure, diabetes and/or coronary artery disease

Anti-resorptive therapy

Osteoporosis and/or osteopenia


Congestive heart failure and/or coronary artery disease

Blood pressure monitors


Inhaled corticosteroids


Insulin and other glucose-lowering agents


Retinopathy screening


Peak flow meter




Hemoglobin A1c testing


International Normalized Ratio (INR) testing

Liver disease and/or bleeding disorders

Low-density Lipoprotein (LDL) testing

Heart disease

Selective Serotonin Reuptake Inhibitors (SSRIs)



Heart disease and/or diabetes


According to IRS Notice 2019-45, the above expenses must also meet the following criteria to qualify:

  • The service or item is low-cost.
  • There is medical evidence supporting high-cost efficiency (a large expected impact) of preventing exacerbation of the chronic condition or the development of a secondary condition.
  • There is a strong likelihood, documented by clinical evidence, that with respect to the class of individuals prescribed the item or service, the specific 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.

How will this affect healthcare?

The guidance will make it easier for participants who have chronic conditions, such as heart disease, diabetes and asthma, to receive reimbursement through insurance and participate in HDHPs and HSAs, which in turn will help reduce their financial burden prior to reaching their deductible. And, by participating in HDHPs and HSAs, this opens the door to even more savings for participants because of an HSA’s triple-tax advantage and retirement-planning potential.

Would you like to learn how you can set your employees up for success with HDHPs and HSAs? Complete the form below and download your eBook today!

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