What is retroactivity on High Deductible Health Plans (HDHP)?
Retroactivity on High Deductible Health Plans (HDHP) Retroactive enrollment in a health plan can impact whether a high-deductible health plan (HDHP) is compatible with a health savings account (HSA). When a group is enrolled in a BCBSRI health plan, the claims are paid according to the existing benefit plan until we process the request for a plan change. According to IRS guidelines, paying a claim before the deductible makes the HDHP no longer HSA-compatible. It also jeopardizes the tax-favored status of the HSA. An HDHP can be set up retroactively if the group or member is not active on another BCBSRI plan, but claims cannot be paid until the HDHP is active. BCBSRI must receive all member information by the 15th of the month preceding the group’s anniversary date for the plan to become effective the next month. If information is received after the 15th of the month, the effective date will be the 1st of the following month. Here are two examples for a company with a renewal date of No
