New Law Makes Permanent Telehealth Coverage in HDHP

The sweeping One Big Beautiful Bill Act signed into law by President Trump on July 4, 2025, makes permanent the ability of high-deductible health plans to offer pre-deductible coverage for telehealth and other remote care services without compromising employees’ eligibility to contribute to health savings accounts.

This change, effective for plan years beginning after Dec. 31, 2024, restores a popular pandemic-era flexibility that had otherwise expired at the end of 2024. For employers that offer HDHPs with HSA options, they can now choose whether to incorporate first-dollar telehealth coverage to enhance their plan’s value, reduce employee costs and improve access to care.

Brief background

Under longstanding federal law, to qualify for HSA contributions, a participant must be enrolled in a qualified HDHP and have no other “impermissible” health coverage — meaning no coverage that pays for non-preventive care before the deductible is met. Historically, this included most telehealth services.

That changed temporarily with the CARES Act in 2020, which allowed HDHPs to cover telehealth on a first-dollar basis without affecting HSA eligibility. Congress extended this relief several times, but the last extension expired on Dec. 31, 2024, for calendar-year plans.

What it means for employees

Telehealth services benefit plan enrollees in many ways:

• Convenience: Workers in rural or remote areas, or those juggling caregiving responsibilities, no longer need to take time off work or travel to see a provider for routine care that can be handled virtually.
• Lower costs: First-dollar coverage for virtual visits can eliminate out-of-pocket expenses for common services like check-ups, prescription renewals or managing chronic conditions.
• Chronic care support: Individuals managing ongoing conditions such as diabetes or hypertension may find it easier to stay on top of treatment plans with telehealth check-ins.

What was not included in the final law

While the law’s inclusion of the telehealth safe harbor was celebrated, many other pandemic-era telehealth waivers were left out of the final package. These excluded provisions include:

• Lifting geographic and originating site restrictions on telehealth under Medicare.
• Allowing audio-only services to qualify for reimbursement.
• Extending telehealth coverage by federally qualified health centers and rural health clinics.
• Eliminating in-person visit requirements for telemental health services.

Unless further legislative action is taken, those waivers will expire by the end of September 2025, limiting broader telehealth expansion — especially for Medicare and rural populations.

Takeaway for employers

Employers looking to implement or reinstate telehealth coverage to their HDHPs should coordinate with their insurance carriers or third-party administrators and update plan documents, summary plan documents and employee communications accordingly.

If your 2025 plan has already started, you may need to send your enrollees special notices informing them of the change.