Texas judge pares back ACA preventive services coverage requirement
The legal battle over the constitutionality of the Affordable Care Act (ACA)’s preventive services coverage mandate took another turn yesterday when a Texas federal district court judge issued a decision (applicable nationwide) eliminating the requirement that all nongrandfathered group health plans and insurers cover USPSTF-recommended preventive services without participant cost sharing and that employer plan sponsors with religious objections cover PrEP HIV medications. The decision will almost certainly be appealed to the 5th Circuit Court of Appeals and perhaps reach the Supreme Court one day. It’s quite possible that during this expected prolonged appeal process the Texas decision will be stayed – put on hold – keeping the preventive services mandate in effect.
Of course, regardless of this recent decision and the ultimate legal outcome, employers will still be allowed to voluntarily provide coverage for preventive services without participant cost-sharing coverage; the Texas decision, if it stands, only removes the requirement – not the ability – for employer group health plans and insurers to provide such coverage. It should also be noted that state insurance laws could require fully-insured plans to cover the same, or a similar, set of preventive services without participant cost-sharing.
What preventive services does the ACA currently require to be covered?
Under the ACA, most insured and self-funded group health plans must provide government-specified preventive services in-network without participant cost-sharing (no deductibles, copayments or coinsurance; this is sometimes called “first-dollar coverage”). Required preventive services include:
- Evidence-based items or services with an “A” or “B” rating in the current recommendations from United States Preventive Services Task Force (USPSTF)
- Immunization for routine use for children, adolescents, or adults recommended by the Advisory Committee on Immunization Practices (ACIP) of the Centers for Disease Control and Prevention
- Infant, pediatric and adolescent evidenced-based preventive care and screenings provided for in the comprehensive Health Resources & Services Administration guidelines (HRSA)
- Additional HRSA-supported preventive care and screenings for women including FDA-approved contraceptives
The effect of the Texas decision
The Texas decision – if it withstands an expected appeal – eliminates the ACA’s USPSTF-recommended preventive services coverage requirement on constitutional grounds and further removes mandatory no-cost coverage of PrEP HIV medications as being a violation of the Religious Freedom Restoration Act. Importantly, preventive services recommendations made by ACIP and HRSA (which include women’s contraception) must still be covered without participant cost-sharing pursuant to the ACA, at least for now. The Texas decision singles out preventive services recommended by the USPSTF, on the grounds that members of this task force are not properly appointed under the U.S. Constitution’s Appointment Clause.
The practical effect of this Texas decision remains to be seen. However, we don’t expect most employers to scale back their no-cost coverage for preventive services from current levels. Generous first-dollar benefits for preventive services already were common before the ACA, and employer commitment to workforce health and wellness has only grown in recent years. It’s also difficult to “take back” a popular benefit like free preventive services.
Finally, there are cost considerations in favor of providing first-dollar coverage of preventive services. A literature review conducted by members of the University of Michigan’s Center for Value-Based Insurance Design concluded that cost-sharing elimination leads to increased use of preventive services, and that those who are financially vulnerable appear to benefit the most. Providing relatively inexpensive preventive services can reduce the need for costly treatment of serious medical conditions that go undetected at early stages or could have been prevented entirely.