High deductible health plans (HDHPs) remain a fairly new health coverage product. In 2005, only 4% of employers that offered health coverage offered access to a high deductible health plan.[1] This percentage initially grew quite quickly – by 2014, it had risen to 27%, and has stayed fairly steady since. Among large employers offering health coverage, 60-70% now offer HDHPs and overall, in 2024, approximately 27% of covered workers were enrolled in HDHPs. However, these enrollment percentages have been stagnant over the past five years.
HDHPs typically have lower premiums than PPOs, but do not provide coverage except for preventive services until participants have satisfied their “high deductible.” HDHPs are often paired with tax-favored health savings accounts (HSAs), which can be used to pay medical expenses on a pre-tax basis. Given the affordability—and focus on individual savings for expenses—the current administration and many private employers have taken actions over the last several years to make HDHPs more attractive to employees.
The previous Trump Administration encouraged the use of high deductible health plans, including through a 2019 Executive Order,[2] which directed the Secretary of the Treasury to issue guidance to help “expand the ability of patients to select high-deductible health plans that can be used alongside a health savings account, and that cover low-cost preventive care, before the deductible, for medical care that helps maintain health status for individuals with chronic conditions.” As a result of the Executive Order, the IRS issued guidance[3] expanded medical care that could be considered preventive care (and thus, may be provided pre-deductible without impacting an HDHP participant’s eligibility for a tax-favored HSA), including adding glucometers, beta blockers, statins, insulin, and inhaled corticosteroids.
Under the current Trump Administration, the One Big Beautiful Bill Act (OBBB) makes permanent a safe harbor that allows plans to be treated as HSA-eligible HDHPs even if telehealth services are provided on a pre-deductible basis. Before the availability of the safe harbor, covering telehealth services before the deductible was met would disqualify the plan from being HSA-compatible. The safe harbor, originally established by the Coronavirus Aid, Relief and Economic Security (CARES) Act, allowed HDHPs to cover telehealth services before the deductible was met, ensuring access to virtual care during the pandemic. The safe harbor expired December 31, 2024; the new OBBB provision applies retroactively as of January 1, 2025. This exemption is a relief for many employers, who were left unsure how to handle charging for telehealth services after the safe harbor expired.
In addition, under the OBBB, individuals enrolled in HDHPs can now also enroll in direct primary care arrangements while maintaining their HSAs. HSA funds may now be used to pay for these direct primary care arrangement fees, limited to $150 per month for individuals and $300 per month for families (each adjusted for inflation) and effective for months beginning after December 31, 2025. This could be advantageous for employees who participate in a primary care arrangement outside of their employer’s benefit plans and who also maintains an HSA.
At the same time, employers are incentivizing enrollment in HDHPs. In addition to subsidizing premiums – sometimes to a greater extent than other plans – many employers are providing seed money for their employees’ HSAs or health reimbursement accounts (HRAs). Of covered employees enrolled in an HSA-qualified HDHP, more than 80% receive some sort of HSA-contribution from their employer, averaging $842 for single coverage and $1,539 for family coverage.[4]
In addition to increased coverage for preventive services, and growing employer incentives, employee education is critical if the goal is to increase enrollment in HDHPs (and corresponding HSAs). High deductibles, and using health savings accounts to save for routine medical expenses, are still new concepts for many employees, and an HDHP may feel overwhelming when one has been used to a PPO plan. Still others may have had experiences with high deductible health plans denying coverage for services that are now considered preventive, and may not be familiar with the recent expansion of HDHP coverage. While time will tell whether these changes will make an impact on enrollment, employers wishing to increase adoption of HDHPs within their workplace should consider expanded employee education, including a focus on the expansion of first-dollar preventive care benefits. In addition, in advance of open enrollment, employers should also review and update their plan documents and communications to reflect their changes under the OBBB.
[1] Kaiser Family Foundation, Employer Health Benefits: 2024 Annual Survey, available at https://files.kff.org/attachment/Employer-Health-Benefits-Survey-2024-Annual-Survey.pdf (last accessed August 28, 2025).
[2] Exec. Order. No. 13877, 84 Fed. Reg. 30849 (June 24, 2019).
[3] I.R.S. Notice 2019-45.
[4] Kaiser Family Foundation, Employer Health Benefits: 2024 Annual Survey, available at https://files.kff.org/attachment/Employer-Health-Benefits-Survey-2024-Annual-Survey.pdf (last accessed August 28, 2025).
