Consumer-directed health plans (CDHPs) are attracting new interest as a result of a ruling by the Internal Revenue Service (IRS) over what constitutes preventive services. CDHP benefit designs take various forms, but in general, these are low-premium, high-deductible plans that provide full or close to full coverage for enrollees once the deductible is met and are typically tied to a health savings account (HSA).
In some plans, the medical and pharmacy deductible is combined; in others, they are separate. Either way, the hope is that when enrollees are paying the first dollar of medical and/or pharmacy costs, they will be more savvy consumers and will make health care choices that lead to lower overall health care costs.
Unfortunately, uptake of these plans has been much slower than originally projected, with only about 5% of insured Americans enrolled in CDHPs in 2007.1 Employers, anxious to reduce health care costs and looking for solutions to increase participation, may have found a new way to entice enrollees: by offering complete coverage of preventive services and medications without members having to first meet the benefit deductible.
Apparently through an IRS ruling concerning HSAs, certain medications used strictly for preventive purposes (including vaccines, contraceptives, cholesterol reducers, smoking cessation agents, and osteoporosis agents) can be provided at no additional cost even if their plan deductible has not been met. This is a benefit for both enrollees and health plans—this could be a way to reduce costs associated with preventable illnesses.
The question then becomes: what is a preventive service or medication? For medications, the answer seems clear as it relates to vaccines and contraceptives. But what about warfarin, antiepileptics, bronchodilators, and 5-HT3 antagonists? Aren’t these agents all prescribed to “prevent” events such as stroke, myocardial infarction, bronchospasm, and nausea? What about immunosuppressives prescribed following organ transplantations? Aren’t these used to prevent rejection of transplanted organs? There are probably at least a dozen other agents that someone could argue are used primarily for a preventive purpose.
How does the plan decide what gets covered before the deductible is met, and what medications and services apply to the deductible under these programs? Presumably, preventive therapeutic agents must be approved by the Treasury Department as being eligible based on the IRS ruling. Call me a skeptic. It is not hard to foresee how physicians will respond when asked if Humira, for example, is being used by their patients with rheumatoid arthritis primarily as a treatment or to prevent the progression of structural damage, knowing that this can mean the difference between full, no, or partial plan coverage.
- 1. Kaiser/Health Research & Educational Trust.
Employer Health Benefits 2007 Annual Survey. Available at:
http://www.kff.org/insurance/7672/index.cfm. Accessed January 22, 2008.