No Prevention Copays Could Benefit Patients, Physicians
Cover Story – March 2011
Tex Med. 2011;107(3):18-25.
By Ken Ortolon
As Benjamin Franklin supposedly said, "An ounce of prevention is worth a pound of cure."
Now, supporters of the health system reform law hope a whole lot of prevention – and free prevention, at that – will significantly reduce Americans' mortality and morbidity from cancer, smoking, obesity, vaccine-preventable illnesses, and other diseases.
A provision of the Affordable Care Act (ACA) that took effect last September requires health plans to cover a wide array of preventive care services without charging patients copayments, coinsurance, or deductibles. The hope is that providing these services at no cost to patients will prompt more Americans to seek preventive care, thereby avoiding more costly and life-threatening illnesses. (See "Preventive Coverage Under Health System Reform," December 2010 Texas Medicine, pages 16-17.)
Eduardo Sanchez, MD, chair of the National Commission on Prevention Priorities (NCPP) and a member of the Texas Medical Association's Council on Science and Public Health, firmly believes evidence-based prevention "sound medical care policy."
"I can't think of one situation where we would rather treat illness than prevent it," said Dr. Sanchez, who also is vice president and chief medical officer for Blue Cross and Blue Shield of Texas (BCBSTX).
While it is too early to know how Americans will embrace free preventive care, experts expect physicians and other health care professionals to see a significant spike in demand for preventive care.
"You don't have to be an economist to know that free is a great price," said Donna Kinney, CPA, manager of TMA's Regulatory Analysis and Advocacy Department. "And patients will use services that are free that they wouldn't use, even with some small amount of cost sharing."
That could be good not only for patients but also for physicians, who likely will see more patients in their offices and, therefore, increased revenues.
But experts also say the new provision could cause some administrative hassles for physicians because not all health plans have to abide by the new requirement immediately. And, the law gives plans significant flexibility in how they implement the new coverage.
That means physician offices will have to figure out which patients have first-dollar coverage and make sure they are in-network for these preventive care services.
Paying the First Dollar
Under ACA, all new individual and group health plans written on or after Sept. 23, 2010, must cover a long list of preventive care services without copayments, coinsurance, or deductibles. Plans that existed before March 23, 2010, the day the law took effect, are "grandfathered," or exempt, from that provision so long as there are no major changes in coverage or premiums.
Plans written after March 23 but before Sept. 23 must comply with new requirement, but not until the next plan renewal.
Preventive care services covered under the law include all vaccinations recommended by the U.S. Centers for Disease Control and Prevention Advisory Committee on Immunization Practices; all services rated as "A" or "B" by the U.S. Preventive Health Services Task Force (USPSTF), including screening for breast cancer, cervical cancer, chlamydia, colorectal cancer, depression, gonorrhea, and hypertension; and all preventive care and screening services for women and children recommended in comprehensive guidelines supported by the Health Resources and Services Administration (HRSA).
For children, that includes services recommended by the American Academy of Pediatrics' Bright Futures guidelines. For women, HRSA has until Aug. 1 to develop guidelines on preventive services not otherwise encompassed by the USPSTF recommendations.
Ms. Kinney says many of the services included in the list will apply only to persons in certain age groups or with certain risk factors. For example, anemia screening is required only for pregnant women, while autism screening is required only for children between ages 18 and 24 months.
Ms. Kinney also says there are some services on the list that the average person might find surprising, such as lactation consulting and nutritional counseling.
Plans in place before March 23 can keep their grandfathered status indefinitely as long as they do not:
Jared Wolfe, executive director of the Texas Association of Health Plans, says health insurers in Texas are writing policies with the newly required first-dollar coverage for preventive care. He says the plans expect the overall impact on health insurance premiums to be only about 1 percent. That's because many group health plans already cover preventive care.
"On the group side, in general, you have a lot more of these plans that are covering preventive services and a lot of the things on that [ACA] list," Mr. Wolfe said. "Again, a lot of them come with office copays, but they are covered."
He expects the requirement to have a much greater impact on individual plans, particularly high-deductible plans usually tied to a health savings account that often have less first-dollar coverage and less generous benefits than most group plans.
"Certain plan enrollees may see a higher impact if they have an individual plan," Mr. Wolfe said.
Ms. Kinney agrees. "The Affordable Care Act requires the plan itself to cover those services first dollar. So there will be some increase in premium for those high-deductible plans because they'll be adding in all of those services that they previously weren't priced for. Patients will no longer be using their HRA [health reimbursement arrangement] or HSA [health savings account] to cover those services."
And, Ms. Kinney says she expects older plan enrollees to see larger premium increases than younger enrollees.
"Younger patients don't generally even fall into some of those recommended categories," she said. "They don't need mammograms, they don't need colonoscopies."
While the preventive service coverage likely will have a modest impact on premiums, Mr. Wolfe says health plans are much more concerned about the impact of other ACA provisions, such as rating restrictions that limit how much plans can charge the elderly, smokers, or others with health risks.
Those provisions take effect in 2014, and Mr. Wolfe expects the impact on premiums to be dramatic. "If you're not factoring in the subsidies that some folks will receive for purchase [of insurance], the pure impact on the premiums for some of those plans will be 30 percent," he said.
Blue Cross Buys In
It is uncertain how many health plans willingly embrace the new preventive care coverage requirements, but a recent national survey by Hewitt Associates LLC indicates most employers believe their plans eventually will have to provide the coverage.
While many companies initially hoped to preserve their existing plans under the grandfather provision, 90 percent indicated they anticipate losing their grandfathered status by 2014, with the majority expecting to do so in the next two years. Among employers with self-insured plans, 51 percent expect to lose grandfathered status in 2011, with 21 percent expecting to lose it in 2012.
Employers said the most likely reason for losing grandfathered status were changes in the health plan design or changes in company subsidy levels.
The state's largest health plan embraces the change. Dr. Sanchez says BCBSTX was a proponent of prevention coverage long before ACA.
"Blue Cross and Blue Shield of Texas has been talking about the value associated with prevention for a long time," he said. "I think from the standpoint of should we be doing this, Blue Cross and Blue Shield of Texas … would say, 'Sure.'"
As chief medical officer for BCBSTX, Dr. Sanchez hopes to see a spike in claims for preventive care.
"We are very much interested in seeing utilization rates get to a place where we are optimizing value," he said. "We'd love to see the spikes, because the fact is the evidence says these are things that work, and, if they work, they will prevent disease, and that's a good thing."
However, there are those who believe prevention might be a hard sell for some patients. Fort Worth pediatrician Gary Floyd, MD, a member of TMA's Council on Legislation, says adult behavior is hard to change. "Adults who never access those services will probably require some encouragement to truly come in and access them," he said.
orman Chenven, MD, founder and chief executive officer of the Austin Regional Clinic (ARC), a large multispecialty group, also says some patients will continue to find excuses to avoid preventive care. Some low-income individuals who have avoided getting preventive care services because of cost may now be more inclined to get them, but others may not, he says.
"There will be a certain percentage of patients for whom the freeness is the hook," he said. "But most people who value physicals get them no matter what and those who don't, don't. And then there are people who are afraid of them."
Dr. Floyd also says there may be some "backlash" against the preventive services if the first-dollar coverage results in significant premium increases.
"We've all read in the papers that insurance companies already are raising their premiums by double digits, not just teen double digits but by 20- to 40-percent increases to employers," he said. He says that could be dangerous if it prompts small employers to drop coverage and force their employees into the insurance exchanges being set up under ACA.
As of mid-January, Dr. Chenven says, ARC had not had a noticeable spike in office visits for preventive care. Spencer Berthelsen, MD, board chair for the 350-physician Kelsey-Seybold Medical Group in Houston, also says his group had not yet seen increased utilization of preventive services.
But that could change. Because a large number of group plans came up for renewal on Jan. 1, many lost their grandfathered status because of changes in premiums, benefits, or other provisions. That has large groups such as ARC scrambling to make sure they know which patients have first-dollar coverage for preventive care.
"As of Jan. 1, there has been a lot of change, in fact an enormous amount of change in terms of health plans and benefits and so on," Dr. Chenven said. "So much so that we have 80,000 patients whose health plan is changing."
Dr. Chenven says ARC attempts to collect copayments when a patient comes to one of its clinics. "But if we don't know the benefits, we're electing to bill them later for the copay rather than collecting the copay and finding later that we have to return it. We're doing our best to determine who has this benefit and who doesn't."
That, however, is producing some long lines at the front desk in their clinics, he says.
As the number of patients with first-dollar coverage for preventive care increases, opportunities to increase patient flow and generate revenue in physicians' practices will grow, Ms. Kinney says. But physicians will have to make some decisions about what services they plan to offer and will have to negotiate with the health plans to make sure they are in network for those services. First-dollar coverage does not apply to preventive care delivered by out-of-network physicians.
"Not all of these services are things that normally are done only in primary care practices," Ms. Kinney said. "So physicians will have to look through those lists [of preventive services] and see which of those things they do offer, which ones they might offer, and which ones they want to add to their practice."
If a physician is not going to offer certain services, he or she also needs to know where to refer patients to get them, she adds.
"Then, they will need to start talking to their health plans because the health plans are not obligated to pay for them at all if they're not offered within network," Ms. Kinney continued. "So physicians will want to be in network. And that may position them to increase revenues in their practice or to grow their practice because those services will be in demand."
Ms. Kinney says ACA specifically gives plans a great deal of flexibility over how they offer preventive care services and how they pay for them. For example, plans may attempt to bundle some of the preventive services into payments for a well-child or well-woman visit, she says. Also, plans could enter into an exclusive contract with certain providers to provide some of the screenings and other services.
Mr. Wolfe says he has heard no conversations among plans about bundling preventive care into a well visit but adds, "I wouldn't deem that to be unreasonable."
Ms. Kinney says the U.S. Department of Health and Human Services is still writing regulations to govern the preventive care provisions, so much of what physicians will need to know is still up in the air.
"We do anticipate that there will be more regulations regulating what the plans can and can't do, but in the meantime you will have to ask a lot of questions about what they cover and how they cover it, how often and how much they pay, and which CPT codes are actually covered," she said.
Where's the Savings?
Proponents of ACA's preventive care provisions say preventing illness through stepped-up prevention can save money in the long run.
Ms. Kinney says that may be true for immunizations and some other services. Most of the other required services likely will not reduce cost, even though they are considered cost effective, "because they do produce much better outcomes and those better outcomes are worth the extra cost," she says. "But on the whole, they are not cost reducing, they will never be cost reducing. They are actually cost increasing."
However, Dr. Sanchez points out that, based on ranking of clinical preventive services by NCPP in 2006, some prevention (including immunizations and tobacco counseling) is cost saving. Some prevention is essentially cost neutral; and some prevention has a cost but a cost that is less than the human cost, workplace cost, and medical care cost of a devastating, life-threatening, and advanced disease, he says.
"Irrespective of the cost effectiveness, prevention is better than treatment," he said. "And that's a value that I think we have embraced not only in Blue Cross Blue Shield of Texas, but I think society in general has embraced the idea that prevention is better than treatment."
He hopes the result will be prevention of such things as cancer and heart disease, at best, and early detection, at worst, when the chance of successful treatment is better.
"And the result could very well be less of those kinds of high-cost claims that are easy to identify after the fact as things that we should have caught sooner than we did."
All of this, however, assumes that ACA is allowed to take effect. The new Republican-controlled U.S. House of Representatives voted in January to repeal it, and the number of states challenging the constitutionality of the law in court is now up to 26.
Ken Ortolon can be reached by telephone at (800) 880-1300, ext. 1392, or (512) 370-1392; by fax at (512) 370-1629; or by e-mail.
Preventive Services Covered by the Affordable Care Act
Below is the complete list of preventive care services that health plans must cover without copayments, coinsurance, or deductibles as of Sept. 23. Not all health plans are covered by this requirement at this time, and first-dollar coverage is required only when the service is provided by an in-network provider.
Covered Preventive Services for Adults
Covered Preventive Services for Women
Covered Preventive Services for Children
Source: U.S. Department of Health and Human Services
Medicare, Medicaid Also Adding Preventive Coverage
Medicare beneficiaries also have seen increased coverage for preventive care services under the Affordable Care Act (ACA) since Jan. 1, including elimination of coinsurance and deductibles for some services.
Those services with no patient cost sharing include:
Norman Chenven, MD, founder and chief executive officer of Austin Regional Clinic (ARC), says his large multispecialty group already is seeing an increase in demand for the annual physical examination.
"Last year, they started something that was called a welcome-to-Medicare physical, which was not really a physical," Dr. Chenven said. "It was an assessment that didn't have a lot of laying on of hands and was not the traditional physical that all of us were trained in doing. But it was just for people who turned 65 and got Medicare that year. Now, there's a physical for everybody, and there are three different codes. We've had to do a rush job in figuring that out so that we could train our doctors and nurses to deal with those patients coming in."
Dr. Chenven says ARC had little demand for the welcome-to-Medicare physicals last year but had 75 people booked for the new free annual physical on the first workday of this year alone.
Dr. Chenven says physicians need to be aware of this new benefit and how to bill for it or risk fraud and abuse allegations.
"We've put together templates for our doctors to fill out," he said. "In a group our size, we're at risk for being chased down for fraud and abuse. If you bill one of these G codes and you haven't done all the pieces, then that's fraud."
TMA officials say ACA also encourages state Medicaid programs to extend preventive health services to adult enrollees by offering additional federal funding if they do.
Texas implemented coverage for an annual adult preventive health examination in January 2010 and also provides coverage for smoking cessation drugs. Later this year, Texas Medicaid will implement coverage for smoking cessation counseling for pregnant women. The adult preventive health benefits in Medicaid vary somewhat from the recommendations within the U.S. Preventive Services Task Force guidelines. For detailed information about what is covered, refer to "preventive care visits" in the Texas Medicaid Provider Manual at www.tmhp.com.