Preventive Care Can Now Be Covered for Specified Chronic Conditions Before HDHP Deductible

Nancy K. Campbell • August 8, 2019

On July 17, 2019 the IRS released Notice 2019-45   resolving a preventive care problem that has been plaguing many high deductible health plans (“HDHPs.”).  The Affordable Care Act’s free preventive care mandate appears to be working.  People are catching medical problems sooner.  As a result, many employers have embraced the concept of free preventive care and want to go a step further – providing free preventive care for certain chronic conditions, such as asthma, diabetes, and heart disease.  However, they have run into a snag.  Under IRS guidance, treatment for chronic conditions is not “preventive care” and covering it before the deductible is met jeopardizes the plan’s status as an HDHP.

Before IRS Notice 2019-45 was released, free preventive care for certain chronic conditions could not be provided under an HDHP before the deductible was met because IRS guidance provided that preventive care generally does not include any service or benefit intended to treat an existing illness or injury.  The Notice provides a good summary of the prior guidance on preventive care.

Now, in addition to items that are preventive care under prior guidance, the medical services received and items purchased, including prescription drugs, for certain chronic are deemed to be preventive care for someone with that chronic condition.  The list below is from the Appendix to Notice and is an exhaustive list of the medical services and drugs that are deemed to be preventive care for the treatment of the specified chronic conditions.  The Notice indicates that the list will be updated every five to ten years.

The Notice is effective July 17, 2019.  Employers that want to take advantage of these new rules may need to adopt plan amendments and prepare employee communications explaining the new rules.  Health plans must be careful that they do not provide free preventive care for chronic conditions beyond what is listed in the Appendix.  Doing so would cause a health plan to not be an HDHP, rendering all participants, not just those who receive free preventive care for chronic conditions, ineligible to make or receive health savings account (“HSA”) contributions.

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By Mardy Gould • May 24, 2024
Employee burnout has become an epidemic in today’s modern workplace. So much so that the World Health Organization (WHO) officially recognizes it as an “occupational phenomenon.”1 While many used to consider mounting workplace stress an individual employee problem, these days, it’s become an employer’s responsibility to prevent burnout before it hurts productivity and business performance—not to mention your employees’ physical and mental health. Luckily, you can prevent burnout from affecting your workforce in several ways. This article will explore the causes and signs of employee burnout and the steps you can take to create a positive work environment where employees feel safe from toxic stress levels.

Form 720 and PCORI fee FAQs

By Mardy Gould • May 23, 2024
If you're a small business owner, you may have heard of the acronym PCORI and the fees that come with it. But what is PCORI, and how does it apply to your organization? Under the Affordable Care Act (ACA), sponsors of self-insured health plans must pay a fee to fund the federal Patient-Centered Outcomes Research Institute (PCORI). PCORI is an independent organization the ACA created to conduct research to help healthcare consumers make better decisions for their specific needs and outcomes. It also performs research related to clinical effectiveness. Employers offering a self-insured medical reimbursement health plan, such as a health reimbursement arrangement (HRA), must pay this fee by July 31 each year via Form 7201. This fee was initially set to expire in 2019, but Congress extended it through September 30, 20292, due to the Further Consolidated Appropriations Act of 20203.
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