COVID-19 PPE Is Now HSA, FSA Eligible

On March 26, the Internal Revenue Service issued Announcement 2021-7 stating that group health plans may be amended to provide for reimbursements of expenses for COVID-19 personal protective equipment (PPE) incurred for any period beginning on or after January 1, 2020. The plans include:

  • health flexible spending arrangements (health FSAs),
  • Archer medical savings accounts (Archer MSAs),
  • health reimbursement arrangements (HRAs), or
  • health savings accounts (HSAs).

Employers can start the change in their plan prior to adopting a plan amendment to allow it.  Employers have until the last day of the next calendar year after the beginning of the change to get the amendment in place.  The amendment must be in place no later than December 31, 2022. We recommend working with an attorney or your broker on the amendment.