Best Advice to Employers as Preventive Care Services are Challenged: Sit Tight

Liliana Salazar, Chief Compliance Officer Western Region, HUB International

A recent ruling (Braidwood Management v. Becerra) challenges a key component of the Affordable Care Act (ACA), Section 2713 that requires non-grandfathered plans to cover preventive care services at no cost. The decision, which is currently under appeal before the Fifth Circuit, could have a meaningful impact on employers and insureds.

If the Fifth Circuit reaffirms the lower Court’s decision, it could be a substantial setback for wellness programs, group health plans, and medical insurance carriers. This could mean that employees and members would have to bear the cost of seeking preventive care services, which would lead to delayed detection and treatment of medical conditions.

• Per the Office of Health Policy, no-cost wellness services were accessible to over 150 million Americans with private insurance.

• A Rand study found that encouraging healthier employee populations helped large organizations save $5 million to $12 million in healthcare costs annually.

• According to the Centers for Disease Control, 90% of the $4.1 trillion in annual healthcare expenditures are for those with chronic or mental health conditions.

• Pre-exposure prophylaxis (PrEP) reduces the transmission of HIV due to sex or injection drug use, its health effects, and the lifetime costs of treating it. The Centers for Disease Control says PrEP is 99% effective at preventing HIV transmission through sex.

The case

The case was filed in the U.S. District Court in the Northern District of Texas by Christian-owned businesses and individuals. In their complaint, the Plaintiffs claimed that the United States Preventive Services Task Force (USPSTF) violated the Appointments Clause of Article II of the United States Constitution, as the appointees to the task force had not been nominated by the President nor approved by the Senate. In addition, the Plaintiffs claimed that the requirement for non-grandfathered plans to cover pre-exposure prophylaxis (PrEP) medications for HIV prevention violated their religious rights under the Religious Freedom Restoration Act (RFRA).

On March 30, 2023, the Court issued a final ruling declaring that “A” or “B” recommendations by the USPSTF made on or after March 23, 2010, were unlawful and enjoined the Departments (HHS, DOL, and Treasury) from implementing or enforcing PHS Act section 2713(a)(1)’s preventive services requirements in the future. However, the Court ruled that preventive services and immunizations recommended by other bodies, such as the Advisory Committee on Immunization Practices (ACIP) and the Health Resources and Services Administration (HRSA), were unaffected by the decision. In addition, the Court ruled that the mandatory coverage for pre-exposure prophylactics (PrEP) by non-grandfathered plans with religious objections violated the Religious Freedom Restoration Act.

“The medical benefits at issue in Braidwood are based on the USPSTF recommendations as to which preventive services should be covered under the ACA at no cost.”

The U.S. Department of Health and Human Services (HHS) is appealing the decision before the 5^th Circuit Court of Appeals. A ruling should be rendered in the next few months. In the meantime, on May 15, 2023, the U.S. Court of Appeals for the Fifth Circuit issued an administrative stay, requiring non-grandfathered health plans to continue covering preventive care services until a final decision is reached by the Court.

What preventive care coverage is impacted?

The medical benefits at issue in Braidwood are based on the USPSTF recommendations as to which preventive services should be covered under the ACA at no cost. If the 5^th Circuit upholds the lower Court’s ruling, employers will no longer have to cover any of the named services or provide them at no cost. These services include:

• Cancer screening/prevention. This includes regular breast cancer screening for women between ages 50 and 74, cervical cancer screening for women between 21 and 65, and colorectal screening in those 50 to 75. Lung cancer screening for former and current smokers over 50 also would be affected.

• Cardiovascular disease prevention. In addition to hypertension screening for those over 18, coverage for prescription statins for adults between 40 and 75 would no longer be mandated.

• Mental health screenings. Screening for depression and anxiety for children and adults would no longer be required, nor would adult screening for unhealthy alcohol or drug use.

• Services to support healthy pregnancies. These services range from screening for urinary infection, gestational diabetes, and Hepatitis B, to screening for risk of depression among pregnant and postpartum patients.

• Coverage for PrEP. Both oral and injectable PrEP could be excluded from coverage by employers who have religious objections to covering PrEP.

As a reminder, the recent ruling has no impact on preventive health services recommended by ACIP and HRSA, including immunizations for children and various services for women, including contraception.

What this decision means for plan sponsors

As the Fifth Circuit issued an administrative stay, non-grandfathered plans should stay the course, as their plans are still required to cover preventive care services at no cost until a final decision is rendered by the Court. However, during this period, employers should assess the possible financial impact to their plans, the implications for covered members, and determine the appropriate course of action if the Appeals Court affirms the lower Court’s decision. Furthermore, if the Fifth Circuit reaffirms the District Court’s decision, employers should be prepared to see legislative action at the state level, as many states have strongly supported the ACA, and most will require insured medical plans to cover preventive care services at no cost.

Self-insured plans should decide what changes, if any, they want to incorporate into their plan because of the Court’s decision, noting that self-insured plans could choose to continue covering preventive care services at no cost.

Employers who sponsor high deductible health plans (HDHP) will have to wait for guidance from the departments, as HDHPs would no longer be allowed to cover preventive care services at no cost as it would affect the tax treatment of employer and participant contributions to Health Saving Accounts (HSA).

Employers should closely monitor developments in the Fifth Circuit to ensure they are prepared to address the impact of this decision on their group health plans.

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