News from the IRS: IRS adjusts HDHPs for COVID-19

April 13, 2020


To facilitate the nation’s response to the 2019 Novel Coronavirus (COVID-19) the IRS issued Notice 2020-15, allowing HDHPs to cover testing and treatment of COVID-19 and not be disqualified.


If a taxpayer has a qualifying HDHP, he or she is eligible to contribute to a health savings account (HSA). If a high-deductible plan loses its status, the taxpayer could be penalized for participating in a plan that does not meet HSA requirements. Many taxpayers take advantage of contributing to an HSA to cover current health expenses or to defer for health expenses in retirement.

Generally, HDHPs are prohibited from covering expenses until the deductible is met. However, HDHPs can offer first-dollar coverage for certain preventative care and chronic illness care. An example might be first-dollar coverage for a mammogram.

COVID-19 testing and treatment is now included in the “first-dollar benefits”, and coverage will not affect high-deductible plan status. This means that a taxpayer’s ability to contribute to an HSA will not be affected if the plan offers first-dollar coverage for COVID-19 testing and treatment. 

This information is important to both financial professionals and their clients. Clients can benefit from a quick update. This also might be a great time to help clients address other concerns, such as having a floor under their investment accounts.


If you have any questions regarding IRS Notice 2020-15, please contact the Retirement Strategies Group at (800) 722-2333, or email us at



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