executive physicals

[Guest katefen]

what about executive physicals and high deductible health plans. Does an executive physical plan preclude the executive's participation in a high deductible health plan? Is the only option to provide the executive with taxable compensation to cover the cost of the physical?

[J Simmons]

Take a look at IRS Notice 2004-23. If annual physicals are part of the safe harbor list for preventative care that does not disqualify one with HDHC from HSA contributions, it would seem annual physicals for executives would not be a problem. So long as the executive physical does not include any service or benefit intended to treat an existing illness, injury, or condition, it should be okay.

[masteff]

I'll add Notice 2004-50 Q&A-10. While not specifically addressed to executive physical programs, it does establish that preventative care services are sometimes disregarded for determining if something is a "health plan" that provides significant benefits in the nature of medical care or treatment.

Q-10. Does coverage under an Employee Assistance Program (EAP), disease

management program, or wellness program make an individual ineligible to contribute

to an HSA?

A-10. An individual will not fail to be an eligible individual under section 223©(1)(A)

solely because the individual is covered under an EAP, disease management program

or wellness program if the program does not provide significant benefits in the nature of

medical care or treatment, and therefore, is not considered a “health plan” for purposes

of section 223©(1). To determine whether a program provides significant benefits in

the nature of medical care or treatment, screening and other preventive care services

as described in Notice 2004-23 will be disregarded. See also Q&A 48 on incentives for

employees who participate in these programs.

[GBurns]

Is an HSA used or offered along with this HDHP ?

Is the HDHP executive only or is it all employees ?