A bout EBRI: The Employee Benefit Research Institute is a private, nonpartisan, nonprofit research institute Sum based miar n iWa zing sh tihe ngt kon, D ey find C, ings f that frocu om t se hs o e sn hea tudy,l w th, sa e not vien tgs, r hat:e tirement, and economic security issues. EBRI does not lobby and does not take policy positions. The work of EBRI is made possible by funding from its members and s •po nsor The i s, whi mpact ch oin pr nclud em e a iu br ms o oad f expa rangnd e of ing p publ rei- c, ded pruct ivaitb e, le c for over -prof age it and n to 116 d onpr rug ofitcl or asgan sesi r za eltat ioed t ns. Fo o ch r m roni orc e August 4, 2022, #441 information go to www.ebri.org or connect with us on Twitter or LinkedIn. disease management medications in HSA-eligible health plans is relatively small (range 1.3 –4.7 percent). • The premium impact was driven by: 1) the amount of increased uptake of drugs as a result of enhanced A Thank You To Our Funders: This study was conducted through the EBRI Center for Research on Health coverage, 2) elimination of all consumer cost sharing or inclusion of coinsurance in lieu of the deductible, Benefits Innovation (EBRI CRHBI), with the funding support of the following organizations: Aon, Blue Cross and 3) whether or not increased drug use led to offsets in spending on non-drug medical expenditures Limited Impact on Premiums of Blue Shield Association, ICUBA, JP Morgan Chase, National Pharmaceutical Council, Pfizer, and PhRMA. (e.g., preventable hospitalitzations). • Premiums increased the least — 1.3 percent — when employers imposed coinsurance instead of a Expanding Pre-Deductible Coverage deductible and when increased use of prescription drugs led to reduced use of other medical services. ### • The most expensive scenario, an increase of 4.7 percent, occurred when increased prescription drug Research from the Employee Benefit Research Institute (EBRI) found the impact on premiums of expanding pre- utilization led to no decrease in use of other medical services and employers did not impose any deductible coverage for 14 services in health savings account (HSA)-eligible health plans as allowed in IRS coinsurance (i.e., zero cost sharing). Notice 2019-45 to be small. Estimated premium increases range from virtually zero to 1.5 percent. Now, a more recent EBRI report found the impact on premiums of expanding pre-deductible coverage to 116 drug classes Figure 2 related to chronic disease management medications in HSA-eligible health plans is also relatively small. Impact on Premiums of Expanding Pre-Deductible Coverage to Chronic Disease Management Medications in HSA*-Eligible Health Plans 5% IRS Notice 2019-45 4.7% Average Coinsurance No Cost Sharing IRS Notice 2019-45 allows health savings account (HSA)-eligible health plans the flexibility to cover 14 medications and services used to prevent the exacerbation of chronic conditions prior to meeting the plan 4% deductible. The U.S. Department of Treasury issued the guidance on July 17, 2019 to further increase the flexibility of HSA-eligible health plans to cover specific low-cost preventive services to prevent the 1 3.1% exacerbation of chronic conditions on a pre-deductible basis. 2.9% 3% Figure 1 Chronic Disease Management Services in the Expanded Safe Harbor 2% Preventive Care Service For Individuals Diagnosed With Congestive heart failure, diabetes, and/or coronary artery Angiotensin-converting enzyme (ACE) inhibitors 1.3% disease Antiresorptive therapy Osteoporosis and/or osteopenia 1% Beta blockers Congestive heart failure and/or coronary artery disease Blood pressure monitor Hypertension Inhaled corticosteroids Asthma Insulin and other glucose-lowering agents Diabetes 0% With Medical Cost Offsets No Medical Cost Offsets Retinopathy screening Diabetes Peak flow meter Asthma * HSA = health savings account. Source: Employee Benefit Research Institute estimates based on administrative enrollment and claims data. Glucometer Diabetes Hemoglobin A1c testing Diabetes International normalized ratio (INR) testing Liver disease and/or bleeding disorders In the absence of utilization increases as a result of covering these 116 drug classes in full, premiums would Low-density lipoprotein (LDL) testing Heart disease increase 2 percent. However, medical cost offsets as well as other forms of cost sharing will reduce the impact of Selective serotonin reuptake inhibitors (SSRIs) Depression expanding pre-deductible coverage on premiums. This is evidenced by the 1.3 percent increase in premiums that Statins Heart disease and/or diabetes we found when average coinsurance is imposed instead of a deductible, and medical cost offsets apply. Source: https://vbidcenter.org/initiatives/hsa-high-deductible-health-plans-2/ Our finding that premiums increased little due to the expansion of pre-deductible coverage is also related to the With IRS Notice 2019-45 in place, all HSA-eligible health plans are now able to adopt a more flexible relatively high percentage of users of the 116 drug classes meeting their deductible. Users of these services are benefit design offering more protection for certain medical services through a value-based insurance design generally high users of health care more generally because of their health conditions. As a result, even when (V-BID) plan structure. coverage for services is provided pre-deductible, these users are likely to continue to meet their deductible. Services that would otherwise be subject to copayments or coinsurance once deductibles are met will be subject to the deductible when other services are no longer subject to the deductible. 1 See https://www.irs.gov/pub/irs-drop/n-19-45.pdf. EBRI’s on Twitter! @EBRI or http://twitter.com/EBRI EBRI blog: https://ebriorg.wordpress.com/ E EB BR RI I on on T Twitt witte er r: : @ @E EB BR RI I o or r htt http:/ p://t /twit witter ter..c com/ om/E EB BR RI I B Blog: log: htt https ps:/ ://ebr /ebrio ior rg. g.wor wordp dpr re es ss s..c com/ om/ © 2022, Employee Benefit Research Institute, 901 D St. SW, Suite 802, Washington, DC 20024, 202/659-0670 www.ebri.org 2 3