How to make healthcare affordable: strategies that can make a difference
Medical treatment must be more affordable and accessible to Medicare and commercially insured individuals living with life-threatening, chronic, and serious diseases. Here are seven strategies that Congress and the Biden administration can adopt to improve healthcare access and affordability in 2022.
1. Healthcare must be affordable and accessible to all, without discrimination.
The administration and Congress should establish a national effort to end longstanding health inequities.
Why policymakers at all levels must focus on making healthcare accessible to all: Disparities in healthcare and health outcomes persist in the United States. Health disparities are attributed to broad structural, socioeconomic, political, and environmental factors that are rooted in years of systemic racism. Certain populations are more likely to experience worse health outcomes, limited access to healthcare services, and lower quality of care based on race, ethnicity, gender, sexual orientation, disability status, or geographic location.
An intentional focus on and understanding of health inequities and disparities can serve as a catalyst for change across multiple sectors, including employment, housing, education, healthcare, public safety, and food access. Achieving health equity will require coordinated leadership at the national, state, and local government levels and with the private sector to address social determinants of health, increase access and affordability of healthcare services, and collect and analyze data to track progress.
2. Place a monthly or annual cap on out-of-pocket costs for prescription medications.
Congress and the Centers for Medicare and Medicaid Services (CMS) should limit the amount Medicare beneficiaries must spend out-of-pocket on prescription drugs. A monthly or annual cap would facilitate access to needed treatments, protect patients from high out-of-pocket costs, and help beneficiaries predict and plan for these costs throughout the year.
Why a cap is needed: Medicare beneficiaries are the only group of insured people in the U.S. that is not protected by a cap on annual out-of-pocket costs, forcing many to make difficult trade-offs or to forgo treatment altogether. Some patients who require expensive medications can incur thousands of dollars out-of-pocket for their prescriptions in January alone, a pattern that requires them to have enough money early in the year to fill their critical prescriptions.
3. Spread out-of-pocket costs for prescription medications more evenly throughout the benefit year.
Congress, insurers, and other stakeholders should modify the structure of public and private insurance plans so that out-of-pocket costs for prescription medications can be spread more evenly over the course of the year, and patients can access and remain on the treatments they need. This is commonly referred to as “smoothing.”
Why smoothing is needed: The structure of Medicare Part D prescription drug plans front loads out-of-pocket medication costs early in the benefit year. This can have a devastating impact on patients who face high cost sharing for their medications. Many patients cannot afford large out-of-pocket expenses all at once or over a short period of time but could afford the total expenditure if spread out over time.
4. Modernize the Medicare Part D Low-Income Subsidy (LIS) program to increase enrollment and provide continuity for individuals from one year to the next.
Congress should modernize the LIS program (also known as Extra Help) to make eligibility easier to establish, expand the income requirements to help a larger population of beneficiaries in need, eliminate cost sharing for generic drugs, and include specific efforts to ensure all eligible beneficiaries are enrolled and taking advantage of the program.
Why LIS should be modernized: Because the current eligibility criteria for the LIS program requires patients to have an extremely low income, millions of Medicare beneficiaries who are economically insecure but slightly above the limit are unable to afford their prescription medications. In addition, the program still requires cost sharing for generic drugs and the application process is difficult, leaving many to miss out on Extra Help altogether.
5. Prohibit co-pay accumulators or similar programs that lead to greater out-of-pocket costs for individuals with life-threatening, chronic, and rare diseases.
Congress and the Centers for Medicare and Medicaid Services (CMS) should prohibit harmful co-pay accumulator programs and require health insurance plans to apply financial assistance received on behalf of a patient toward their out-of-pocket maximum.
Why co-pay accumulators should be prohibited: With high-deductible health plans on the rise, patients with serious conditions often turn to financial assistance to afford their out-of-pocket prescription medication costs in a variety of ways. They might seek help from charitable assistance foundations, manufacturer assistance programs, friends and family, faith-based communities, and even crowdfunding sites. These forms of assistance are a lifeline for people who need ongoing access to expensive specialty drugs required to treat their conditions.
Commercial insurance co-pay accumulator policies prevent patients from using financial assistance to count toward their deductibles, resulting in a much larger overall out-of-pocket financial burden. These policies are especially harmful to lower-income patients who require expensive medications and those enrolled in high-deductible health plans.
6. Public and private insurers should adopt policies that address social determinants of health to mitigate barriers that prevent patients from adhering to their medications.
Public and private insurers should adopt policies that mitigate barriers to treatment. Addressing social determinants has the potential to improve patient health outcomes and reduces avoidable healthcare spending.
Why we must address social determinants of health: Socioeconomic factors like economic stability, education, healthcare access and quality, neighborhood and environment, and social and community context drive more than 80 percent of health outcomes. Leaving social factors unaddressed leads to preventable disparities in health status, medication adherence, and disease outcomes.
Potential policies could include payment models that incentivize screening patients for social needs and connecting them with needed services and education.
7. Telehealth services provide access to healthcare and should continue to be an option, particularly for those in rural and underserved areas.
Congress and the Centers for Medicare and Medicaid Services (CMS) should keep telehealth services including coverage for audio-only services.
Why telehealth services are vital to expanding healthcare access: Telehealth can help expand access to care and maintain continuity of care for all patients. For Medicare beneficiaries, access to telehealth services is especially important. From July to September 2020, 15.1 million Medicare beneficiaries had a telehealth visit with a doctor or other healthcare professional, according to the Kaiser Family Foundation—nearly half of beneficiaries whose providers offered telehealth services.
It is important to allow the use of audio-only equipment for a wide range of Medicare services as well, to ensure that telehealth is accessible to underserved groups. Among Medicare beneficiaries who had a telehealth visit, 56 percent reported accessing care using a telephone only. Among Medicare beneficiaries who are over 75, live in rural areas, identify as Hispanic, or have Medicare and Medicaid, a majority reported using audio-only telehealth services.