Any unplanned medical event can leave your employees struggling to cover expenses. The COVID-19 pandemic is a glaring example of this, since it brought with it additional (and substantial) financial ramifications.
During this time, it’s important that your employees are using their benefits most effectively. HSAs, FSAs and HRAs all have the potential to help your employees significantly with COVID-19 related expenses as per the Coronavirus Aid, Relieve and Economic Security (CARES) Act.
To assist you in educating your employees on how they can use their HSA, FSA, and HRA funds for COVID-19 related costs, we’ve compiled a list of eligible expenses.
COVID-19 testing and treatment
In March 2020, the IRS announced that COVID-19 testing and treatment are considered qualifying expenses for HSAs.
While many health insurance plans are covering COVID-19 testing, antibody testing and many treatment methods, many people are still left with out of pocket expenses. And for those with a HDHP, the out of pocket expenses can pile up.
The IRS made this change to remove barriers that prevented people from getting proper testing and treatment. If the plans your employees selected does not fully cover testing and treatment, their HSA is a viable option.
Many people have put off necessary medical care during the pandemic to avoid exposure in doctor’s offices. However, this could be more detrimental to people’s health in the long run.
As part of the CARES act, individuals can use their HSAs, FSAs and HRAs to pay for telehealth services. That way, people can get the professional health services that they need, without having to leave home when possible.
Many doctors and urgent care centers began offering their own telehealth services for non-emergency situations during this time, and they will likely remain an option for the foreseeable future.
Certain over-the-counter medications
Previously, prescriptions were required to use HSA/FSA/HRA funds for medications, even over the counter. However, the CARES act eliminated the prescription requirement. Now individuals can use their funds to cover over the counter medications like aspirin, pain reducers, allergy medicine, etc. all without needing to see their doctor first.
Along with telemedicine, this change allows people to get the care they need without having to visit the doctor.
Additional items needed in quarantine
Other items that are necessary for a safe quarantine or shelter-in place due to COVID are also covered. According to the FSA store, disposable face masks, thermometers and other staples can be reimbursed with an FSA, HSA or HRA.
Additionally, over-the-counter menstrual and feminine hygiene products are FSA/HSA/HRA eligible for the first time. While this might not directly tie in to COVID-related expenses, it may help ease the stress of overall increased financial burdens for your employees.
Monthly health insurance premiums
For those who are furloughed or currently receiving COBRA benefits, HSAs/FSAs/HRAs may be used to pay health insurance premiums. This is dependent on certain circumstances, so be sure to help employees thoroughly research their individual situations before relying on this as a payment method.
Important notes about HSAs, FSAs and HRAs
While what employees can use their account funds for might be a little different, how they use them hasn’t changed. Be sure to stress the importance of saving receipts and documenting all purchases to ensure they get proper reimbursement.
Also, communicating with your employees about how to utilize their benefits is more important than ever. While COVID-19 is certainly a health crisis first, it’s leading to financial crises for many families. Helping them utilize their benefits in the most effective way will relieve financial pressure, reduce stress and show your employees that you truly care for them and support them during a challenging time.
And for individuals that currently were not enrolled in an HSA, FSA or HRA, this is a great opportunity to start a conversation about why it may be beneficial to do so during the next open enrollment period.