The 2004 Cup champion has not been cleared to compete since the crash at Pocono on 23 July, which left him experiencing concussion-like symptoms. He has been fully focused on his recovery since then, missing four Cup races so far.
Busch will now miss the next two races as well, ending the regular season on the sidelines, but has targeted a return for the first playoff race at Darlington on 4 September.
As one of 15 drivers in the Cup Series to taste victory so far at 2022, coming at Kansas in May, the 44-year-old will be entered into the playoff's round of 16 unless two more drivers can score their first wins of the year at this weekend's Watkins Glen road course race and in the final race of the regular season at Daytona International Speedway.
NASCAR Xfinity Series title contender Ty Gibbs will continue to sub for him in the #45 23XI Racing Toyota Camry. Gibbs has a best finish of 10th in four starts so far, coming at Michigan.
Busch released the following statement late on Thursday: "As much as I want to be back in the car, the time is still not right.
"Over the last few weeks, I have focused all my efforts on getting better. And in order to fully focus my recovery on trying to be back for the playoffs, I will not be competing in the next two races at Watkins Glen and Daytona.
"This decision was not an easy one, but the right one. I need to be racing at 100%.
"I owe that to everyone at 23XI, all of our partners, my fellow competitors, and the fans. It's my goal to be back in the #45 23XI Racing Toyota Camry TRD to start the playoffs.
"I know Ty will continue to do a great job in my absence, and I appreciate the competitiveness he's brought to the track.
"I continue to be incredibly grateful for all the well-wishes and support. It truly means a lot."
As the lowest-ranked driver to have won a race thus far in the points standings, Busch would be eliminated from the playoffs if two new drivers were to notch their first wins of 2022 in the coming races.
Ryan Blaney (currently second) and Martin Truex Jr (fourth) are the best-placed drivers in the points without a win, with the best-placed of that duo in the standings set to claim the 16th spot in the playoffs if no other drivers claim a victory.
