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New Regulations Ban Cost Sharing for Preventive Services in Some Health Plans

By Rebecca Adams, CQ HealthBeat associate producer

July 14, 2010 -- Preventive care services for about 41 million people next year will not require cost-sharing such as co-pays, co-insurance or deductibles, under a rule announced Wednesday by First Lady Michelle Obama and administration officials.

The elimination of cost-sharing for preventive care services such as cancer screenings, vaccines, smoking cessation counseling and tests that could indicate a risk for heart disease could push premiums up by an average of about 1.5 percent, according to administration estimates. That translates into a shift of about $54 for an average $3,606 policy sold in the individual market and $72 for an average $4,824 employer-sponsored plan affected by the proposal.

The new regulation is an interim final rule that has the force of law. The administration will collect comments on the rule for 60 days and then finalize it. It could be modified but typically would change little, if at all.

The guidelines will apply to new health plans beginning Sept. 23, which the administration estimates will affect 31 million people in employer-provided plans and 10 million in plans bought by individuals next year. Plans that were in effect before the health care overhaul passed in March will be exempt unless the benefits for the plan change. As health plans are modified over time, the number of people affected could rise to about 88 million by 2013.

The regulations are part of a broader effort under the health care overhaul law (PL 111-148; PL 111-152) to prevent medical problems rather than simply treat disease after it strikes. The law calls for about $15 billion in spending on preventive care over a decade through such initiatives as the elimination of cost-sharing for preventive services under Medicare. Many health policy analysts and researchers believe that routine preventive care can keep people healthier, but that costs can deter people from seeking it.

One questions about the administration's plan is which services would count as "preventive."

Some of the services are straightforward—based on recommendations by the Advisory Committee on Immunization Practices at the Centers for Disease Control; the Health Resources and Services Administration and the American Academy of Pediatrics; and the U.S. Preventive Services Task Force, best known for releasing mammography screening guidelines for breast cancer last year that suggested that most low-risk, asymptomatic women do not need annual mammograms.

But guidelines for some services affecting care for women are still being written. They are expected to be released by Aug. 1, 2011. Reproductive rights groups are already lobbying lawmakers for birth control to be included, while groups such as the U.S. Conference of Catholic Bishops say that it should not be covered.

Some women's groups applauded the overall regulations but noted their concern about the coverage of contraception.

"When these regulations take effect, all insured women will have access to critical preventive care including mammograms, screenings for cervical cancer and sexually transmitted infections, and the HPV vaccine, which many girls now forgo because the cost is prohibitive," said Debra Ness, president of the National Partnership for Women and Families. "The next step in making our health care system work better will be to act swiftly to release additional requirements that extend this coverage to the family planning and contraceptive health care that women rely on."

Even though increased preventive care often enjoys some bipartisan support, some congressional Republicans were not impressed with the proposal. "Some would say this preventive care is free, but there is no free lunch, and mandates are passed on to consumers in the form of higher premiums and less access," said John Hart, a spokesman for Sen. Tom Coburn, R-Okla.

Republicans also are suspicious of the involvement of the U.S. Preventive Task Force in setting coverage policy. They recall the controversy when the mammogram recommendations were released last year and some women felt that their health could be compromised if they reduced the frequency of breast cancer screening. They say that allowing the government and advisory groups to mandate which services private insurers must cover is a step toward government-run medical care. "These entities are going to be empowered to effectively determine the scope of care and what's funded and reimbursed," Hart said.

But supporters say that preventive care is a wise investment that can improve health care outcomes and lower costs for the country. "Getting access to early care and screenings will go a long way in preventing chronic illnesses" that consume up to three-fourths of the nation's health care spending, said Obama. The first lady views preventive care as another element of her campaign to reduce childhood obesity, an issue that she said first came to her attention when her pediatrician expressed concerns about her own children's weight.

Health and Human Services Secretary Kathleen Sebelius cited a study that found that preventive care in five areas—colorectal and breast cancer screening, flu vaccines, regular aspirin use to avoid cardiovascular problems and smoking cessation—could prevent 100,000 deaths a year.

The administration said that the proposal could lower out-of-pocket costs significantly. They said the new proposal could save $300 a year for a 58-year-old woman who got a mammogram, colon cancer screening, tests for diabetes and cholesterol, a flu shot, and a Pap smear test for cancer.

"The things that are being covered are important services that I don't think you can know ahead of time whether you need or not," said DeAnn Friedholm, the director on health reform at Consumers Union.

Patients advocacy groups also applauded the regulation. "These new regulations will make disease prevention more accessible and affordable for all Americans," said American Heart Association CEO Nancy Brown.

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