As health reform discussions progress, influential stakeholders have urged policy makers to consider increasing the flexibility of health savings account—eligible high-deductible health plans.
This article was collaboratively written by A. Mark Fendrick, MD, director of the Center for Value-Based Insurance Design (V-BID), and several V-BID Center staff.
As health reform discussions progress, influential stakeholders have urged policy makers to consider increasing the flexibility of health savings accounteligible high-deductible health plans (HDHPs). Marilyn Tavenner, the president and CEO of America’s Health Insurance Plans (AHIP), recently said “Policy makers should consider proposals that increase the availability and flexibility of HSAs, allowing plans to exempt certain services from the HDHP deductible (such as prescription drugs to prevent the onset of a chronic condition)…”
Increasing plan flexibility is a key element of the High-Value Health Plan (HVHP), a value-based insurance design initiative designed to improve care quality and affordability in HSA-HDHPs. Guided by the Internal Revenue Service (IRS) safe harbor under section 223(c)(2)(C), HSA-HDHPs may provide select preventive care benefits prior to meeting the plan deductible. However, until the deductible is met, coverage does not include “any service or benefit intended to treat an existing illness, injury, or condition, including drugs or medications.”
Thus, HSA-HDHP enrollees with existing conditions are required to pay out-of-pocket for necessary services, resulting in lower utilization of care, poorer health outcomes, and potentially higher costs.
Adoption of this clinically nuanced HVHP has the potential to mitigate cost-related non-adherence, enhance patient-centered outcomes, allow for premiums lower than most preferred provider organizations and health maintenance organizations, and substantially reduce aggregate healthcare expenditures. The HVHP would provide millions of Americans a plan option that better meets their clinical and financial needs.