Health insurance rule could help millions spend less for the care they need

July 17, 2019

Millions of Americans with chronic conditions could save money on the drugs and medical services they need the most, if their health insurance plans decide to take advantage of a new federal rule.

Today, the U.S. Department of the Treasury gave health insurers more flexibility to cover the cost of certain medications and tests for people with common chronic conditions who are enrolled in many high-deductible health plans.

The idea behind that rule was born at the University of Michigan. And the change came about in part because of research and over a decade of policy engagement by U-M professor A. Mark Fendrick, M.D., and his colleagues at the U-M Center for Value-Based Insurance Design.

About 43 percent of adults who get health insurance through their jobs have a high-deductible plan, which requires them to spend at least $1,300 out of their own pockets before their insurance starts covering their care, or $2,600 if they cover family members.

People with high-deductible health plans typically have to pay the entire cost for services used to manage chronic conditions - such as inhalers for asthma, blood sugar testing and insulin for diabetes, and medicines to treat depression and high cholesterol - until they've reached their plan deductible.

More than half of them have access to a special kind of tax-advantaged health savings account to save money for their health costs, and some employers contribute to those accounts.

But until today, the federal tax code specifically barred high-deductible plans with health savings accounts, or HSA-HDHPs, from covering drugs and services for common chronic conditions until enrollees met their deductibles. Such coverage could reduce the chance that people with chronic conditions will skip preventive care because of cost, and improve their longer-term outcomes.

Meanwhile, the bipartisan Chronic Disease Management Act of 2019 was introduced in the Senate and House of Representatives last month with the same goal of lowering out-of-pocket costs for Americans with chronic conditions confronting high plan deductibles.

"As more and more Americans are facing high deductibles, they are struggling to pay for their essential medical care," says Fendrick, a professor at the U-M Medical School and School of Public Health and an internal medicine physician at Michigan Medicine. "Our research has shown that this policy has the potential to lower out-of-pocket costs, reduce federal health care spending, and ultimately improve the health of millions diagnosed with chronic medical conditions. We have actively advocated for this policy change for over a decade."

Specific coverage for specific enrollees

The new rule designates 14 services for people with certain conditions that high-deductible health plans can now cover on a pre-deductible basis.

The list closely aligns with the one laid out by the V-BID Center in a 2014 analysis, That report, based on clinical evidence available at the time, shows that these tests and treatments could help people with chronic diseases manage their health, and detect or prevent worsening of their conditions, at low cost.

The list includes:The new Treasury guidance also leaves the door open to allow high-deductible plans more flexibility in the future for coverage of other preventive services for people with these and other chronic conditions.

Fendrick and Harvard University professor Michael Chernew articulated the need for regulatory changes to level the playing field for people with chronic conditions in high deductible health plans in the Journal of General Internal Medicine in 2007.

V-BID principles - based on the idea that the highest-value clinical services should cost the least to people who need them most - have also made their way into other kinds of health insurance plans.

For instance, Medicare Advantage plans, offered by private insurers to people over age 65 and with disabilities, are now able to offer plans with value-based co-pays. So are plans offered under TRICARE, the insurance program for military families, and private employer-sponsored plans without high deductibles.

The V-BID team has recently introduced V-BID X, a novel benefit design to expand options in the individual market by enhancing coverage of essential medical services and drugs, without increasing premiums or deductibles.
-end-
More about V-BID and high-deductible health plans is available at http://vbidcenter.org/initiatives/hsa-high-deductible-health-plans-2/

In addition to his role as Director of the U-M Center for Value-Based Insurance Design, Dr. Fendrick serves as a consultant to several public and private organizations, and is founding partner of V-BID Health, a company that assists employers, health insurance plans, and health systems in designing health care benefits packages.

Michigan Medicine - University of Michigan

Related Diabetes Articles from Brightsurf:

New diabetes medication reduced heart event risk in those with diabetes and kidney disease
Sotagliflozin - a type of medication known as an SGLT2 inhibitor primarily prescribed for Type 2 diabetes - reduces the risk of adverse cardiovascular events for patients with diabetes and kidney disease.

Diabetes drug boosts survival in patients with type 2 diabetes and COVID-19 pneumonia
Sitagliptin, a drug to lower blood sugar in type 2 diabetes, also improves survival in diabetic patients hospitalized with COVID-19, suggests a multicenter observational study in Italy.

Making sense of diabetes
Throughout her 38-year nursing career, Laurel Despins has progressed from a bedside nurse to a clinical nurse specialist and has worked in medical, surgical and cardiac intensive care units.

Helping teens with type 1 diabetes improve diabetes control with MyDiaText
Adolescence is a difficult period of development, made more complex for those with Type 1 diabetes mellitus (T1DM).

Diabetes-in-a-dish model uncovers new insights into the cause of type 2 diabetes
Researchers have developed a novel 'disease-in-a-dish' model to study the basic molecular factors that lead to the development of type 2 diabetes, uncovering the potential existence of major signaling defects both inside and outside of the classical insulin signaling cascade, and providing new perspectives on the mechanisms behind insulin resistance in type 2 diabetes and possibly opportunities for the development of novel therapeutics for the disease.

Tele-diabetes to manage new-onset diabetes during COVID-19 pandemic
Two new case studies highlight the use of tele-diabetes to manage new-onset type 1 diabetes in an adult and an infant during the COVID-19 pandemic.

Genetic profile may predict type 2 diabetes risk among women with gestational diabetes
Women who go on to develop type 2 diabetes after having gestational, or pregnancy-related, diabetes are more likely to have particular genetic profiles, suggests an analysis by researchers at the National Institutes of Health and other institutions.

Maternal gestational diabetes linked to diabetes in children
Children and youth of mothers who had gestational diabetes during pregnancy are at increased risk of diabetes themselves, according to new research published in CMAJ (Canadian Medical Association Journal).

Two diabetes medications don't slow progression of type 2 diabetes in youth
In youth with impaired glucose tolerance or recent-onset type 2 diabetes, neither initial treatment with long-acting insulin followed by the drug metformin, nor metformin alone preserved the body's ability to make insulin, according to results published online June 25 in Diabetes Care.

People with diabetes visit the dentist less frequently despite link between diabetes, oral health
Adults with diabetes are less likely to visit the dentist than people with prediabetes or without diabetes, finds a new study led by researchers at NYU Rory Meyers College of Nursing and East Carolina University's Brody School of Medicine.

Read More: Diabetes News and Diabetes Current Events
Brightsurf.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.