The IRS on Wednesday issued guidance that makes it easier for patients enrolled in high-deductible health plans to get coverage for medications and drugs to treat chronic illnesses, including asthma, congestive heart failure and diabetes.
Under the guidance, chronically ill patients will be able to access coverage for certain services before they spend enough money out of pocket to meet the high deductible. Previously, those plans covered only low-cost preventive-care services prior to the deductible being met.
The guidance, effective immediately, follows President Donald Trump's June 24 executive order that directed the U.S. Treasury Department to find ways to expand the use of health savings accounts paired with high-deductible health plans to pay for "medical care that helps maintain health status for individuals with chronic conditions."
The guidance noted that patients with certain chronic conditions face cost barriers that prevent them from seeking necessary care. Failing to address those needs often leads to consequences such as heart attacks and strokes that require even more medical care.
The IRS, with the Treasury Department and HHS, re-classified certain medical services to treat chronic care as preventive for someone with that chronic condition. The list of 13 services that can now be covered without a deductible include insulin and glucometers for diabetes, inhalers for asthma, blood pressure monitors for hypertension, and SSRIs for depression.
In determining what services would be included on the list, the trio of agencies chose care that was low cost and likely to prevent the chronic illness from getting worse or the patient from developing a secondary condition that required higher cost treatments. The agencies will review and add or subtract from the list periodically, according to the guidance.
Several groups that have been pursuing HSA expansion for years cheered the guidance.
"Pre-existing, chronic conditions are debilitating for millions of Americans. These conditions also represent an enormous drain on the economy through high health costs and reduced employee productivity. Modernizing HSAs to address chronic disease prevention is important to help tackle this problem," James Klein, president of the American Benefits Council, said in a statement.
In 2017 about 19% of workers with job-based health insurance were enrolled in high-deductible health plans eligible for a health savings account, according to the latest data from the Centers for Disease Control and Prevention. That was up from 4.2% in 2007.
While some advocates have touted high-deductible plans as way to tamp down healthcare spending by giving employees' more "skin in the game," others have argued that the plans discourage patients from getting needed care for fear of racking up a big medical bill.
Experts have said that allowing patients to access care for chronic illnesses would alleviate some of that issue and lead to lower healthcare spending in the long run.
"As more and more Americans are facing high deductibles, they are struggling to pay for their essential medical care," Dr. Mark Fendrick, director of the University of Michigan's Center for Value-Based Insurance Design, said in a statement. "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."
