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Plan sponsors that offer high-deductible health plans (HDHPs) paired with Health Savings Accounts (HSAs) will no longer be permitted to cover telehealth services before the deductible is met, as Congress failed to extend the safe harbor allowing this benefit as part of the American Relief Act of 2025, the law passed in late December to fund the federal government for the next few months. The provision may be taken up in the next Congress, but current rules expire for plan years beginning on or after January 1, 2025.
The telehealth safe harbor for HSA-qualified HDHPs was originally created by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The CARES Act permitted HDHPs to cover telehealth or other remote-care services before the plan’s deductible is met, effective on March 27, 2020 for plan years beginning on or before December 31, 2021.
Legislation enacted in March 2022 extended this flexibility from April 1, 2022 through December 31, 2022 and subsequent legislation further extended the telehealth flexibility for plan years beginning after December 31, 2022, and before January 1, 2025.
President Biden signed the American Relief Act of 2025 on December 21, 2024. The law funds the government through March 14, 2025, and provides disaster relief appropriations and economic assistance to farmers. However, the bill does not include an extension of HDHP telehealth flexibility.
Congressional leadership had originally negotiated a bipartisan bill that would have extended the HDHP telehealth flexibility rule for an additional two years.
Sponsors of HDHPs that have HSAs with plan years beginning before January 1, 2025 may continue to reimburse individuals for telehealth services before the deductible for the remainder of that plan year. However, for HDHPs with a plan year of January 1, 2025 or later, plans may not reimburse individuals for telehealth services before they meet their deductible. If a plan permits reimbursement for telehealth services before the deductible is met, the HDHP would not be HSA-qualified, and therefore participants could not contribute to an HSA for that plan year.
Consequently, plans should assure that telehealth services provided before the deductible is met in an HDHP are subject to cost-sharing, unless the service is for a preventive benefit required under the ACA (e.g., a telehealth visit to obtain a prescription for a preventive service).
Telehealth services continue to be a popular benefit. Plan sponsors should contact their health plan administrator to determine how they will implement telehealth benefits in an HDHP and whether they will be communicating changes to plan participants. In some cases, plan documents may need to be amended concerning telehealth coverage.
It is possible that the telehealth provision could be revived in the new Congress, although it is likely those efforts would take several months.
However, it is unclear when or whether there will be action on the proposed legislation. Plan sponsors should monitor developments on this issue in the next Congress.