Specialty pharmacies are poised to fill a need in health care should the use of Health Savings Accounts grow.
Since the Affordable Care Act (ACA) was passed in 2010, the original legislation has undergone a number of changes, adjustments, and revisions. In the coming years under President Donald Trump, the ACA will continue to be transformed. At this time, it is unclear what specific changes will take place, but it is likely that Health Savings Accounts (HSAs) will play a larger role in plans offered and promoted by both commercial and public insurers.
The early days of the Trump administration indicate that changes are coming that will significantly impact the future of ACA legislation. First, it is likely that HSAs will become more common in commercial insurance, according to a study by the American Enterprise Institute for Public Policy Research. Americans don’t want insurance; they want simply want reliable health care.
A major focus is to ensure widespread uptake of HSAs by the American public. A one-time tax credit equal to the amount contributed by the consumer will help to boost both the number of HSAs created, and the dollar value each account holds. The benefits of HSAs are realized when patients are able and willing to save money for future needs, without simultaneously experiencing immediate health care needs.
The HSA may be rolled over year-to-year, and medical costs are paid out when incurred. Currently, HSAs have not gained widespread acceptance because they are not well understood by the public, nor are they designed efficiently to attract more membership. Unrelated to the election, I would predict that HSA account offerings will begin to look more and more favorable, as premiums migrate from costing more than “gold” plans to become less expensive.
Beyond the benefit of lower monthly premiums, HSAs will become more popular as a savings vehicle. Under the Trump administration, it is likely that HSAs will be allowed to transfer hands, willed to offspring, or donated to charity without tax penalty. The conservative view of this system is that money saved for health care should not necessarily be spent on health care that is not necessary. When this change becomes standard, it is likely that HSAs will have to maintain a minimum balance as plan holders age, to cover health care costs, but that the rest may be withdrawn, as is the case with any other retirement account, with minimal tax implications and penalties.
Trump’s appointment of Seema Verma to head the Center for Medicare Services indicates that changes to Medicare and Medicaid may be in the future. In her career, Verma helped to shape Indiana’s current Medicaid program where individuals are responsible for contributing to accounts and managing spending from those accounts. The Medicaid waiver accounts have also been proposed in Iowa, Kentucky, Tennessee and Michigan. Currently, more than one-third of the US population is covered by Medicare or Medicaid, according to a Kaiser Family Foundation report. Any change to these large groups will have a ripple effect on the rest of the health care landscape.
A large increase in HSAs would impact specialty pharmacy by potentially making it more difficult to get patients initiated on therapy. Patients with HSAs typically do not have prescription coverage carved out from the deductible. As a result, patients would likely be looking at a large bill when initiating specialty drug therapy.
Although the purpose of an HSA is clearly to fund needed health care expenses, it is reasonable to assume that no one wants to see their account drained. An exploration of benefits would likely show large bills due at the beginning of coverage years, as well as invoices delivered at drug therapy initiation. With increased costs, manufacturers will likely need to beef up patient assistance programs in order to help patients afford large bills at the beginning of therapy.
As with any great change, the goal for specialty pharmacy must be to stay proactive in adapting to new pieces of the legislation. Clearly, specialty pharmacies that are able to effectively navigate the high deductible landscape for patients will see an increase in business.
Furthermore, manufacturers will want to include specialty pharmacies in network that can successfully get patients initiated on therapy. Similarly, patients will want to work with specialty pharmacies that show they can help reduce a person’s out of pocket/HSA expenses.
Finally, payers will want participating specialty pharmacies to take care of their members in a manner that they feel is of high quality. Ultimately, as HSAs become more common in the coming years, specialty pharmacies will have unique opportunities to grow and continue to fill a need in health care.
About the Author
John Meehan earned his PharmD degree from Duquesne University in 2010. He worked in retail pharmacy in rural North Carolina before transitioning to a clinical pharmacist position at Chartwell PA in Pittsburgh, PA. John completed his Masters of Science in Pharmacy Business Administration degree in 2016 at the University of Pittsburgh.