The CARES Act and subsequent guidance provided plan sponsors with additional flexibility to offer telehealth services to participants. Generally, the relief was intended to ensure that healthcare services remained accessible to participants while minimizing the potential spread of COVID-19. Although some of the telehealth relief provisions have a set expiration date, others continue until the declared end of the COVID-19 public health emergency.
For example, the CARES Act allowed a high deductible health plan (HDHP) to cover telehealth services without a deductible or with a deductible below the minimum deductible normally required for an HSA-qualified HDHP. Importantly, such coverage could be provided even if the telehealth services were not related to COVID-19. Accordingly, plan sponsors could amend their plans to permit coverage of telehealth services before the statutory deductible was met, without these services being considered “impermissible” coverage for HSA eligibility purposes. As a result, participants of such amended HDHPs could continue to make HSA contributions while using the telehealth services.
Unfortunately, this temporary HDHP relief allowing for broad coverage of telehealth services is only available for plan years beginning on or before December 31, 2021. (Despite the immense popularity of this particular provision, no regulatory announcement has yet been made to extend the relief further.) Accordingly, the provision currently expires for calendar year plans on December 31, 2021. For non-calendar year plans, the relief would continue for the remainder of the plan year that ends in 2022. For example, the relief would extend through June 30, 2022, for a plan year beginning July 1, 2021.
The CARES Act also requires that group health plans cover COVID-19 testing without cost-sharing, whether provided via telehealth or otherwise. The plans must cover items and services provided to participants that result in administration of a COVID-19 diagnostic test for individual evaluation purposes. However, this requirement does not extend to testing for workplace surveillance purposes.
In separate guidance, the IRS stated that coverage of COVID-19 testing and treatment could be provided by a qualified HDHP prior to satisfaction of the statutory deductible, without such coverage being considered impermissible coverage. Therefore, participants could continue to contribute to HSAs while receiving such services. This relief was intended to reduce financial and administrative barriers to COVID-19 testing and treatment, whether provided through an in-person or telehealth visit.
The Cares Act requirement for coverage of COVID-19 testing without cost-sharing and the IRS relief (referenced in the preceding paragraph) remain in effect as the COVID-19 public health emergency continues. However, it is unclear if this IRS relief could apply to coverage for testing provided for other than individual diagnostic purposes; additional guidance would be welcome. Employers that sponsor HDHPs and wish to provide COVID-19 testing coverage without cost-sharing for workplace safety purposes should consult with counsel for guidance.
Additionally, COVID-19 relief was provided for a telehealth arrangement sponsored by a large employer (generally defined as an employer with over 50 employees) and offered only to employees or their dependents not eligible for coverage under any other group health plan offered by the employer (e.g., part-time employees). Under this relief, the telehealth arrangement is exempt from certain (but not all) ACA requirements, such as the prohibition on annual and lifetime limits and the preventive services mandate.
This relief extending telehealth services to otherwise ineligible employees is in effect for the duration of any plan year beginning before the end of the COVID-19 public health emergency. For example, if the emergency ends in June 2022, the relief would extend through the end of 2022 for a calendar year plan.
We will continue to monitor the regulatory guidance for further telehealth updates.