Earlier this year, the Internal Revenue Service (IRS) issued a number of new notices updating and clarifying the preventive services expenses that high deductible health plans (“HDHP”) can cover without affecting a participant’s health savings account (“HSA”) eligibility. As background, there are multiple requirements that must be met in order for a plan to qualify for HSA-compatible HDHP coverage. One of these requirements is that the plan must require that a participant pay at least the federal minimum deductible before it pays for covered services. In 2025, the minimum HDHP deductible has been set at $1,650 for single coverage, and $3,300 for family coverage. However, there are a number of exceptions in which a plan may pay prior to an individual hitting their deductible, also known as “first dollar coverage.”
One of these exceptions provides that a HDHP may provide preventive care benefits without a deductible, or with a deductible below the minimum annual deductible. To be a preventive care benefit, the benefit must either be described as preventive care by law, or be determined to be preventive care in guidance issued by the Department of the Treasury and the Internal Revenue Service (IRS.)
In Notice 2024-75, the IRS clarified that a plan will not fail to be an HDHP merely because the plan provides medical care services and items purchased related to breast cancer screening other than mammograms, continuous glucose monitors, and select insulin products. Additionally, the IRS added two types of contraception to the list of preventive care. The guidance expands the definition of preventive care to include over-the-counter (OTC) oral contraceptives, including products for emergency contraception such as Plan B, and also expands to include male condoms. Previously, only female condoms were included.
While HDHP plans are not required to provide first dollar coverage for these services, those plans that wish to include these services for the 2025 plan year should work with their insurer or third party administrator (TPA) to ensure they make any necessary updates. If you would like more information on this updated guidance, please contact any member of the Bricker Graydon Employee Benefits Team.
