Telehealth Safe Harbor Is A Win-Win For Workers And Employers 

The One Big Beautiful Bill signed into law on July 4 contains some of the most consequential changes to U.S. healthcare policy since the Affordable Care Act. While many healthcare stakeholders — from physicians and employers to patients and policymakers — are justifiably concerned about the projected impact on insurance coverage and access to care, the bill contains an important and largely overlooked bright spot: pre-deductible telehealth coverage for people enrolled in high-deductible health plans (HDHPs).

The bill reinstates and permanently extends an expired safe harbor policy, created during the Covid-19 public health emergency, that enables employers to provide low- or no-cost telehealth services to HDHP enrollees before they meet their deductible, without affecting their ability to use health savings accounts (HSAs). While at first glance this provision — technically an amendment to the federal tax code — might seem like fine print compared to the bill’s bigger-ticket policy changes, it represents a major win for healthcare consumers and employers alike.

The safe harbor policy, which has had broad bipartisan support, solidifies what many already recognize: virtual care is a core component of healthcare delivery. Telehealth has become far more than a pandemic-era stopgap or an occasional source of transactional, one-off care. Whether it’s traditional brick-and-mortar providers offering a convenient alternative to office visits, or health tech companies fusing digital and in-person interactions into a single, modern healthcare experience, virtual care is now embedded across the healthcare landscape.

Roughly half of all Americans have now had a virtual visit, and the vast majority of those patients have embraced virtual care for a growing list of needs including everyday urgent care, talk therapy, and longitudinal support for chronic and complex conditions. Amid widespread physician shortages and the persistent access barriers — geographic, social, and/or financial — that prevent too many people from getting essential care, virtual care has become a lifeline for millions. 

The expiration of the safe harbor in December 2024 put that lifeline at risk. For people enrolled in HSA-eligible HDHPs — a category, also known as consumer-directed health plans (CDHPs), that covers more than 20% of the working-age population with private insurance — the expiration threatened to limit access to virtual care by raising out-of-pocket costs (and affecting HSA eligibility). More broadly, and just as important, the expiration threw a wrench in the ongoing innovation among employers and their health care partners that has accelerated the revolution in virtual care.

Employers, especially large self-funded employers who are directly responsible for their employees’ health care costs, have played a central role in making virtual care more accessible and affordable for the U.S. workforce. Just under two-thirds of private employers expanded or encouraged virtual care services for employees in response to the pandemic, and more than 80% of health plans serving self-funded employers reduced or eliminated cost-sharing in CDHPs . 

Some of these employers opted to reinstate cost-sharing as early as 2021, which in some cases led to a predictable falloff in utilization, as seen in a JAMA Network Open study on virtual mental health care. However, the vast majority of employers — 76%, according to a survey from the Employee Benefit Research Institute (EBRI) — were in favor of making the safe harbor provision permanent.

The broad support among employers reflects their understanding of the growing importance of virtual care in improving access to high-quality, high-value care that employees can’t always get in brick-and-mortar settings.

Research has shown that people with HDHPs are more cost-sensitive than other employees and more likely to delay or forgo preventive care as a result, increasing their risk of ending up in the ER or hospital. The safe harbor provision not only reduced direct out-of-pocket expenses like copays, but also gave HDHP enrollees — for the first time, at scale — a convenient option for essential care that cut down on indirect costs such as transportation, gas money, and lost wages due to taking time off work.

Pre-deductible telehealth coverage has proven to be a powerful lever to help employees make healthcare decisions that are mutually beneficial for themselves, their loved ones, and the health of their employer. While it doesn’t require them to waive copays or coinsurance, the safe harbor provision has given employers that option without a looming expiration date, empowering them to think bigger about the long-term role of virtual care in keeping their workforce healthy, happy, and productive.

It’s much too soon to tell how the One Big Beautiful Bill will reshape U.S. healthcare. At a time of so much uncertainty and anxiety, the safe harbor provision is a much-needed safe space that offers consumers and employers the flexibility and opportunity to continue working toward a healthcare experience that works for them.

Photo credit: Sorbetto, Getty Images

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