The IRS recently expanded their guidelines for reproductive and preventative care that is covered by insurance and tax advantaged accounts like HSAs, FSAs, and HRAs. As HR teams work to ensure that their employees have access to the care they need, understanding these guidelines can enable benefits teams to craft comprehensive, and supportive, benefits packages for employees in different locations and different stages of life. Of particular importance is the access to reproductive health care. Women over the age of 16 make up 47% of the workforce and 83% of those women expect their employer to cover the full range of reproductive care. In addition, 86% of women said being able to control when and if they become a parent has been important to their career. 

Employer policies and the laws of the state in which the employees work now have more impact over the type of reproductive care an employee can access, and how they access that care, than ever before. If helping employees maintain access to reproductive health care, making sure employees stay healthy with comprehensive preventative care, and ensuring equitable access to care overall is part of your company’s benefits strategy, there are many tools at your disposal.

What is considered reproductive healthcare and how does it benefit all employees?

Reproductive health care is a broad category of healthcare that affects all genders. It covers birth control, family planning, prevention of sexually transmitted diseases and infections (STDs and STIs), care for pregnant people, education for new parents, new baby care, and more. You might associate this type of care only with female employees. But employees of all genders can benefit from reproductive health care as well. 

Access to condoms and other forms of contraception, family planning, and education resources can have a positive impact on all employees’ lives and stress levels. Whether employees are single or partnered, all can can additionally benefit from access to different types of birth control and family planning, care for pregnant people, and regular access to women’s healthcare. 

As legislation and policy evolves, employers can help all of their employees maintain access to this critical form of healthcare through the benefits that the offer. 

What are the new IRS guidelines around reproductive and preventative care?

In November 2024, the IRS made changes to their guidelines on what they considered preventative care and the types of expenses that could be reimbursed for through a Health Savings Account (HSA), Flexible Spending Accounts (FSAs), and Health Reimbursement Arrangements (HRAs). These are the changes they made:

1. Condoms are now considered a qualified medical expense and can be purchased using HSA, FSA, and HRA funds 

2. The following care is now considered “preventative care” and thus covered at a 100% under a High Deductible Health Plan (HDHP) before the deductible.

   1. All types of breast cancer screenings.

   2. Certain insulin products. This applies regardless of whether the individual has been diagnosed with diabetes or whether it’s been prescribed to prevent the exacerbation of diabetes, or developing a secondary condition. 

   3. For individuals capable of becoming pregnant: oral contraceptives including the full range of FDA-approved, granted or cleared contraceptives are considered preventative care. This includes over-the-counter progestin-only and emergency contraceptives. 

   4. The prescription restriction on Levonorgestrel has been removed. This can now be purchased over-the-counter with HSA, FSA, HRA, and Archer MSA funds.

   5. Glucose monitors are considered preventative care when prescribed to someone who has been diagnosed with diabetes. 

What benefits help maintain employee access to reproductive care?

The recent IRS adjustments have made fringe benefit accounts like HSAs, FSAs, and HRAs important tools employers can offer to help employees across the country equitably access reproductive care. These are all of the benefits that employers can use to support their employees’ reproductive health.

• HDHPs. Since the IRS has designated a large portion of reproductive care as “preventative”, and all preventative care is covered at 100% with an HDHP, offering employees HDHPs ensures they always have affordable access to reproductive care.

• HSAs. For reproductive health care that isn’t designated as preventative, HSAs give employees that have HDHPs a way to save for the care they need tax-free. Employers can contribute money to these accounts as well to further support employees.

• FSAs. These accounts give employees that don’t have an HDHP a way to save for the reproductive health care they need tax-free. FSAs can be paired with any kind of health insurance plan.

• HRAs. Group HRAs, Qualified Small Employer HRAs (QSEHRAs) and Individual Coverage HRAs (ICHRAs) can all be used by employees to reimburse for reproductive health care costs. QSEHRAs and ICHRAs can be used by employees to purchase their own health insurance plans so employees can choose the level of reproductive health coverage they desire.

• Medical Travel Accounts (MTAs). MTAs are post-tax accounts into which employers deposit money that employees can use to reimburse for necessary medical travel that is 50 miles or more from the employee’s home. The types of medical travel that is eligible for reimbursement includes: Mileage on the employee’s personal car, airfare, taxis, train fare, bus fare, necessary lodging and more. For employers with a distributed workforce around the country, MTAs can be an important benefit for those needing to access care that may not be available locally.

• Lifestyle Spending Accounts (LSAs). LSAs are post-tax, employer-funded accounts through which employees can reimburse for eligible expenses. Employers have a lot of flexibility in how they structure their LSAs, they can even offer several different types, each with its own focus. For example, an employer could offer an LSA targeted to helping its employees with family planning and expansion, reimbursing for family planning health care, surrogacy costs, adoption expenses, fertility costs not covered under their insurance plan, and more. 

How Lively can help

Lively has a comprehensive suite of flexible employee benefits that can be bundled to craft a package that supports the needs of your unique workforce. We act as your partner, ensuring employee communication, onboarding, customer service and general administration goes smoothly. We support you, so you can support your employees. If you’re ready to uplevel your benefits, reach out to Lively today!