In light of changes to IRS Notice 2019-45 allowing 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 deductible, this Fast Fact explores the top findings from an EBRI study that studied use of health care services after this IRS change.
percent to 75 percent of employers substituted either copayments or coinsurance for the deductible, depending on Key Findings From the Study: the service or drug. • Overall, we found that between 2018 and 2021, the IRS notice increased the use of 3 of the 7 medical According to the 2021 EBRI survey, employers would add coverage for additional services if allowed by the IRS. services in HSA-eligible plans compared with non-HSA-eligible plans. Use of low-density lipoprotein September 14, 2023, #481 There is also bipartisan, bicameral legislation that has been introduced in the U.S. Congress that would provide (LDL) testing, hemoglobin A1C (HbA1C) testing, and retinopathy screening increased by a larger 2 additional flexibility to extend pre-deductible coverage to services that manage chronic conditions (S. 655). percentage among enrollees in HSA-eligible plans compared with those in health plans not targeted by Employers and policymakers have an appetite for more flexible plan designs or “smarter ” deductibles because this policy change, suggesting that the IRS notice contributed to increased use of these services. rising health care spending has created serious fiscal challenges. Smarter deductibles may also benefit plan Use of Health Care Services Increased After Employers enrollees. • In addition, use of 3 of 7 prescription medications — selective serotonin reuptake inhibitors (SSRIs), statins, and angiotensin-converting enzyme (ACE) inhibitors — increased by a larger percentage among Added Pre-Deductible Coverage in Response to Increased About EBRI: The Employee Benefit Research Institute is a private, nonpartisan, and nonprofit research institute enrollees in HSA-eligible plans compared with those in health plans not targeted by this policy change, based in Washington, D.C., that focuses on health, savings, retirement, and economic security issues. EBRI does IRS Flexibility suggesting that the IRS notice also contributed to increased use of these prescription drugs. not lobby and does not take policy positions. The work of EBRI is made possible by funding from its members Figure 1 and sponsors, which include a broad range of public and private organizations. For more information, visit IRS Notice 2019-45 allows health savings account (HSA) –eligible health plans the flexibility to cover 14 Percentage of Plan Enrollees Using Medical Service, by Type of Health Plan www.ebri.org. m edications and services used to prevent the exacerbation of chronic conditions prior to meeting the plan 2018 2021 deduc 35t% ible. A 2021 Employee Benefit Research Institute (EBRI) survey of employers collected information on 31% HSA-Eligible Health Plan Enrollees A Thank You to Our Funders: This study was conducted through the EBRI Center for Research on Health their response 29% to the 2019 guidance and found that many employers added pre-deductible coverage as a result of 30% Benefits Innovation (EBRI CRHBI), with the funding support of the following organizations: Aon, Blue Cross the IRS notice. A recent EBRI report based on claims data from about 2 million HSA-eligible health plan 25% Blue Shield Association, ICUBA, JP Morgan Chase, Pfizer, and PhRMA. enrollees confirmed the expected findings from the 2021 EBRI survey — as a result of fewer enrollees in HSA- 20% eligible health plans having deductibles for services impacted by the IRS notice, use of health care services 17% ### i ncreased for some of these services. 13% 15% 10% IRS Notice 2019-45 5% 3% 2% 2% 2% 0.11% 0.07% 0.06% 0.06% 0.02% 0.06% 0% The U.S. Department of Treasury issued guidance on July 17, 2019, via IRS Notice 2019-45 to further Low-Density Hemoglobin A1c Retinopathy International Peak Flow Meter Glucometer Blood Pressure increase the flexibility of HSA-eligible health plans to cover specific low-cost preventive services to Lipoprotein (LDL) (HbA1C) Testing Screening Normalized Ratio Monitor Testing (INR) Testing 1 prevent the exacerbation of chronic conditions on a pre-deductible basis. Source: Employee Benefit Research Institute estimates based on administrative enrollment and claims data. Figure 1 Chronic Disease Management Services in the Expanded Safe Harbor Preventive Care Service For Individuals Diagnosed With Figure 2 Congestive heart failure, diabetes, and/or coronary artery Angiotensin-converting enzyme (ACE) inhibitors Percentage of Plan Enrollees With Prescription Drug Fill, by Type of Health Plan disease 18% 2018 2021 Antiresorptive therapy Osteoporosis and/or osteopenia 16% HSA-Eligible Health Plan Enrollees Beta blockers Congestive heart failure and/or coronary artery disease 14% 13% Blood pressure monitor Hypertension 12% 11% Inhaled corticosteroids Asthma 10% Insulin and other glucose-lowering agents 9% Diabetes 8% Retinopathy screening Diabetes 8% 6% Peak flow meter Asthma 6% 5% 4% 4% 4% 4% Glucometer Diabetes 4% Hemoglobin A1c testing Diabetes 2% 2% 2% 2% 2% International normalized ratio (INR) testing Liver disease and/or bleeding disorders 0% Low-density lipoprotein (LDL) testing Heart disease Insulin and Selective Statins Angiotensin- Beta Blockers Antiresorptive Inhaled Selective serotonin reuptake inhibitors (SSRIs) Depression Other Serotonin Converting Therapy Corticosteriods Glucose-Lowering Reuptake Enzyme (ACE) Statins Heart disease and/or diabetes Agents Inhibitors (SSRIs) Inhibitors Source: https://vbidcenter.org/initiatives/hsa-high-deductible-health-plans-2/ Source: Employee Benefit Research Institute estimates based on administrative enrollment and claims data. With IRS Notice 2019-45 in place, all HSA-eligible health plans are now able to adopt a more flexible benefit design offering more protection for certain medical services through a value-based insurance design Use of health services may not have changed for all targeted services and prescription drugs because many (V-BID) plan structure. employers substituted copayments and/or coinsurance for deductibles. The 2021 EBRI survey found that the percentage of employers that eliminated cost sharing for the preventive services identified in the IRS notice 1 ranged from a low of 25 percent to a high of 40 percent, depending on the service examined. In other words, 59 See https://www.irs.gov/pub/irs-drop/n-19-45.pdf. 2 See https://www.congress.gov/bill/118th-congress/senate-bill/655. 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