A September ruling by Judge Reed O’Connor, federal district judge of Texas, struck down part of the preventive coverage mandate of the Affordable Care Act (ACA). But the move should not lead to employers imposing coinsurance payments for certain preventive goods and services that they are now required to cover in full, health policy analysts say.
O’Connor reigned Braidwood Management Inc. v. Becerra that it was unconstitutional under the ACA for the US Task Force on Preventive Services to require the vast majority of health plans nationwide to provide free preventive services. At the time of this article’s publication, O’Connor had not issued a formal appeal or decided on the scope of the decision, which he could only apply to the plaintiffs who sued (a management services company in Katy, Texas), or nationwide at most health departments. plans. Either way, a call from the Biden administration is certain.
However, “I just don’t see employers backing down [paying for preventive care coverage] even if they’re allowed to,” said Paul Fronstin, director of health benefits research at the nonprofit Employee Benefits Research Institute (EBRI) in Washington, D.C. “Most of employers recognize the value of high-value service coverage, and we’re not talking big bucks here.”
Although O’Connor’s decision opens up, at least in theory, the possibility for employers and insurers to reduce some of their costs, Tim Jost, professor emeritus at the Washington and Lee University School of Law in Lexington, Va. , and frequent contributor to the Commonwealth Fund commentary on health policy, doesn’t see Congress keen to get people to start paying for things that are now covered.
“I think it will be difficult for any politician to run against preventive services,” Jost said.
A representative from at least one insurer said he had not heard from any of his employer clients discussing cuts in funding for preventive services.
“It’s not a trend we see or even hear about,” said Debra J. Williams, director of sales and marketing at Blue Cross Blue Shield of Massachusetts. “Preventive care is crucial in our employer customers’ strategy, and they want to make this path affordable and accessible. For example, the vast majority of our self-funded customers have adopted our $0 co-pay strategy on virtual platforms. [telehealth] first aid.”
Fronstin said the likely lengthy appeal process around O’Connor’s decision likely means very little, if anything, will change in how preventive services are covered.
“Things are obviously in flux until we get more information from the court on the extent of this,” he said. “But just because employers are allowed to charge for cost sharing doesn’t mean they will.”
Approval of status quo
In October, shortly after O’Connor’s decision, Fronstin and his colleagues at EBRI conducted a survey of 25 large employers who together represent 600,000 employees and 1.2 million lives covered. Among the results:
- 80% of HR decision makers who responded said they would continue to fully cover prevention services. This was true even if they were allowed to impose cost sharing.
- Only 8% would require cost sharing for at least some preventive services.
- 12% answered: “It depends.”
When EBRI asked respondents why they would continue to provide preventive services at no cost to members, a number said that full coverage of preventive services “incentivizes their use, promotes better health, prevents more serious, is insignificant in terms of costs and saves money in the long run.”
Focus on the costs of PrEP
O’Connor’s decision also found that the plaintiff’s religious beliefs had been violated under the Religious Freedom Restoration Act, given the plaintiff’s religious objection to covering an HIV prevention drug known as the name pre-exposure prophylaxis (PrEP) for employees.
In a later EBRI research paper, Fronstin and colleagues found that the per-patient cost of these drugs is relatively high at $13,814 per year, but this is still only a small portion. overall health expenditure of a typical employer.
“Because so few enrollees use PrEP medications (about 0.17% of all members), the total cost of these medications is only 0.41% of total spending” by healthcare employers, found Researchers. “If, for example, employers imposed a 20% cost-share on patients for PrEP drugs, employer spending would drop by less than a tenth of 1%.”
For other commonly used preventive screenings, the savings that could be achieved by introducing a 20% cost-sharing – typical of non-preventive care – were even smaller: employers would save 0.11% on co-payments on screenings breast cancer and 0.15% for colorectal screening.
Some recommended services impose no additional cost, the EBRI researchers said, because they are often provided as part of a routine office visit, such as screening for high blood pressure, smoking and unhealthy weight. .
Incentives for preventive care
Joe Vitale, director of human resources at Oberlin College in Oberlin, Ohio, said the university has provided additional incentives to receive preventive care for its approximately 1,700 employees, all of whom are covered by a high-deductible health plan linked to health savings accounts (HSAs). For example, the amount of employer contribution to the HSA has been tied to plan members seeing their physician for annual physicals or biometrics, although these requirements have been suspended due to COVID-19.
“In addition, we have moved to frontloading all employer-paid HSA funding to a single January lump sum,” to encourage preventative care such as annual medical checkups, Vitale said.
Jost expressed concern that small employers might choose to charge for prevention services, even if large employers do not.
“If you’re talking about insured employers, and especially small employers, that might sound quite different,” he said.
The profile of the employees can also make a difference. With a small employer, “if you have [many] employees who are all over 55 get colonoscopies and whatever else it might look quite different than if you’re in the tech industry and you have a lot of younger employees who don’t get much preventive services,” noted Jost.
However, he added, given the possibility of a lengthy appeal process for this case in federal courts, nothing should happen to the benefit warrants until 2024 or beyond. And, since a significant basis for O’Connor’s decision was a narrow ruling that the way the U.S. Preventive Services Task Force is named is unconstitutional, insurers and employers who still wanted to provide preventive services and encourage their use could use guidelines from other sources. —specialty medical societies, for example—if Congress does not address the decision through subsequent legislation.
Another option for employers who decide to add additional cost sharing to reduce their costs could be to provide some preventive services and medications for free while adding co-payments for others.
“There are many ways to control costs,” Fronstin said. “Shifting costs onto employees is one way. Trying to get better deals with your suppliers is another, like contracting centers of excellence for surgery and giving your employees incentives to go there.
To take the Centers of Excellence strategy further, employers could begin to contract with colonoscopy providers and incentivize employees to travel to that provider, as another way to control costs.
Greg Goth is a freelance health and technology writer based in Oakville, Connecticut.
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