The One Big Beautiful Bill Act (OBBBA) contained several provisions affecting employer health group plans, including permanent relief for qualified high deductible health plans (HDHPs) that are compatible with health savings accounts (HSAs). Those provisions affect HDHPs that provide first-dollar or low-cost telemedicine coverage that is not subject to the minimum deductible as well as fees for certain direct primary care (DPC) arrangements. The OBBBA itself provided welcome relief for employers, but there were still a lot of outstanding questions regarding how the law would work in practice.
The IRS recently issued guidance providing some additional details on telemedicine (and other remote care services), the use of HSA funds tax-free for periodic DPC fees, and HSA-compatibility designations for bronze and catastrophic plans available through the Marketplace. This alert summarizes that IRS guidance and provides important considerations for employers sponsoring HSA-compatible HDHPs.
