As the public response to the spread of COVID-19 evolves with each passing day, how tax-free healthcare consumers could use their benefits to prepare has been a bit of an open question in the health and wellness industry. But new guidance from the IRS has loosened current restrictions to allow for coronavirus testing to be an accepted expense under high-deductible health plans (HDHPs).
This is particularly big news for health savings account (HSA) users, who must be enrolled in an HDHP to contribute to an HSA. Here's the two most important points they should know about:
- COVID-19 testing and treatment will be fully covered under HDHPs, which means that they will be covered even if yearly plan deductibles have not been met.
- Any COVID-19 vaccines that are covered in the future will be under the same classification as other vaccines as "preventive care," and covered by an HDHP.
- These new rules only apply to HDHPs that are compatible with HSAs.
This is a positive development that will help millions of HSA users use their tax-free funds to take responsible steps to safeguard their health. We are hoping the IRS will take the next step to open up products including hand sanitizer, gloves and other antibacterial products to FSA/HSA spending with no restrictions in the future so consumers can use their tax-free funds to prepare for COVID-19.
Stay tuned to HSAstore.com/Learn for more tax-free healthcare developments as they arise.