The U.S. government has released new guidance that will allow some high-deductible health insurance plans to cover preventative services and medications for those with chronic conditions, including diabetes, before a plan’s annual deductible is paid off.
This new guidance would only apply to high-deductible plans that include Health Savings Accounts (HSAs), however.
This means that those with type 1 diabetes who are covered under the qualifying plans would no longer have to dread paying the full list price for insulin when plans renew each year. High-deductible plans would also be allowed to pay for other glucose-lowering drugs, retinopathy screenings, fingerstick blood sugar meters, and HbA1c screenings before a deductible is met.
The guidance was issued by the U.S. Department of the Treasury on July 17th in response to a June executive order by President Donald Trump that, among other things, ordered the Treasury Department to issue guidance “to 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.”
Qualifying health plans would be those which require an annual deductible of at least $1,350 for an individual or $2,700 for a family, according to a Wall Street Journal report. The plans would also need to offer the option of pretax HSAs, which provide a tax-shelter incentive for participants to save money for health care costs.
The new coverage also would cover some medications and treatments for asthma, bleeding disorders, bone density issues, cardiovascular health issues, depression, and liver disease.
Here is the complete list of what is covered:
The U.S. government will periodically review and revise the services that would be covered under the guidance.
The goal is to remove a cost barrier to therapies for chronic conditions which would otherwise get worse without treatment, according to a Treasury press release. Low-income earners on high-deductible health plans will skip care, even for chronic conditions, because of cost, according to a 2018 study by the Robert Graham Center, a think tank focused on improving health care.
According to the Wall Street Journal report, this change in guidance has long been sought after by insurers, employers, and patient advocates.
However, efforts to reform the U.S. health care system often end up shifting the burden of costs, sometimes in unexpected ways. For example, HSAs, a tool created by a 2003 law to help consumers, may not necessarily benefit those who might need the most help to pay for health care costs. A 2015 study co-authored by Treasury Department officials found that high-income tax filers and older individuals were four times more likely than low-income tax filers to enroll in HSAs over a seven-year period. According to that study, critics of HSAs believe that those with higher tax liability will benefit the most from plans with HSAs.
In other words, while this new guidance may immediately and demonstrably benefit those covered under qualifying high-deductible plans, only time will tell if it will help bring down average out-of-pocket costs for U.S. consumers.