Employer Action Motivates Advocacy Group to Seek More Services Pre-Deductible
The Smarter Health Care Coalition (SHCC), a multi-stakeholder effort working to promote value-based insurance design, is urging the administration to increase benefits for chronic disease management that can be offered pre-deductible for High-Deductible Health Plans (HDHPs) and Health Savings Accounts (HSAs).
Previous IRS guidance made clear that only preventive services could be covered pre-deductible for High Deductible Health Plans and not any service or benefit intended to treat an existing illness, injury or condition. More recent guidance in IRS Notice 2019-45, ”Additional Preventive Care Benefits Permitted to be Provided by a High Deductible Health Plan Under § 223,” included testing and prescription drugs for individuals with asthma, diabetes, hypertension, heart disease, and osteoporosis, noting that “failure to address these chronic conditions has been demonstrated to lead to consequences, such as amputation, blindness, heart attacks, and strokes that require considerably more extensive medical intervention.”
In a letter to the Secretary of the US Treasury Janet Yellen and IRS Commissioner Charles Rettig, the SHCC is noting the “overwhelming, positive response to the guidance in the form of employers and health plans making changes to their plan designs to cover high-value services pre-deductible,” citing results from several surveys:
- 48% of employers with 2,000 or more employees and 29% of employers with 200 or more “changed the services or produces that individuals with chronic conditions could receive without first meeting their deductibles” (2020 Kaiser Family Foundation Employer Health Benefits Survey);
- 75% of health insurance plans covered additional services pre-deductive in their fully insured products and 80% of plans covered additional services pre-deductible in their self-insured products (2021 America’s Health Insurance Plans and SHCC Survey); and
- 66% of employers added pre-deductible coverage for blood pressure monitors and insulin/glucose lowering agents, 61% added coverage for glucometers, and 54% added coverage for beta blockers (2021 Employee Benefit Research Institute Survey).
The SHCC cited the dramatic need for mental health services and inequities in availability. “Nearly half of all Black, Hispanic, Asian, Native American and LGBTQ+ individuals say they have personally experienced increased mental health challenges over the past 12 months, but few received treatment.” To address this problem, the SHCC asked the IRS to expand the current guidance to include mental health services pre-deductible. “The time is now for action to empower employers and health plans to address rising incidence of chronic mental illness.”
Purchasers can learn more about how to improve health, equity, and management through deductibles with the National Alliance of Healthcare Purchaser Coalitions (National Alliance) issue brief, Better Value, Smarter Deductibles in HSA-HDHPS. That publication contains practical steps for employers to:
- examine how high deductible health plans can expand pre-deductible coverage to include high-value care and prescription drugs
- be intentional about health equity strategies
- educate and motivate employees to use high-value pre-deductible health care
- improve employee health
To learn more on how to maximize the benefits of high-deductible health plans, the National Alliance is holding a webinar on the subject on February 15th from 9 am to 10:15 am PT. Register here.