First-Dollar Coverage of Telehealth Services Reinstated

A provision reinstating first-dollar coverage of telehealth services for high-deductible health plans (HDHPs) from April 2022 through the end of the year was included in the omnibus package signed into law this week, allowing employees to access telehealth services without having to pay their copay or deductible.

Background: IRS rules governing HDHPs do not consider telehealth to be eligible as preventive care, meaning employees must first meet their deductible before telehealth is covered. The Telehealth Expansion Act was first introduced as part of the CARES Act but was time limited and expired at the end of 2021. The provision included in the omnibus package provides an additional extension until the end of 2022; however, it is not retroactive to the beginning of this year. 

Telehealth has been crucial in expanding access to mental health services. Our 2021 CHRO survey showed that 79% of respondents offered mental health virtual care and telebehavioral health services to their employees to address access challenges. Provider shortages, in conjunction with limited in-network providers, make it difficult for employees to find affordable behavioral health providers. Research also suggests that telebehavioral health results in better medication compliance, fewer visits to the emergency departments, fewer admissions to inpatient units, and fewer subsequent readmissions. Removing the financial barrier to telebehavioral health through first-dollar coverage removes one of the roadblocks employees face in accessing behavioral health care services.

Outlook: HR Policy has been advocating for passage of the Primary and Virtual Care Affordability Act (H.R. 5541), which extends the exemption of telehealth services from HDHP rules until December 31, 2023, along with other legislative changes to remove barriers employers face when providing telehealth services to employees.