New Evidence of Discrimination in Essential Health Benefit Plans

While the Affordable Care Act (ACA) expanded access to health insurance coverage for millions, a new study from the Harvard T.H. Chan School of Public Health reveals that insurers may be discriminating against patients through the drug benefit design of Essential Health Benefit plans.

Published this week in The New England Journal of Medicine (NEJM), “Using Drugs to Discriminate — Adverse Selection in the Insurance Marketplace,” reveals that insurers are using a variety of tactics to dissuade less healthy, higher-cost patients from choosing their health plans, thereby cherry-picking the patients they prefer by creating access barriers.

The authors analyzed the tiering of plans in 12 states, assessing cost-sharing for one of the most commonly prescribed classes of HIV medications. Through their analysis, the authors identified a practice they called “adverse tiering,” a scenario whereby all of the commonly prescribed medications for a given condition (like HIV) are placed on tiers with a coinsurance or copayment level of at least 30%. Such cost-sharing tactics mean that patients with certain chronic conditions – like HIV/AIDS – face discriminatory practices that could quite simply mean their medicines are out of reach. 

But that’s not the only example. As the authors note, there is also evidence of this trend when examining other serious conditions such as cancer and autoimmune diseases such as rheumatoid arthritis and multiple sclerosis.

As nearly one in two American adults lives with at least one chronic illness, these findings are cause for concern.

And, patient advocates have taken notice. 

In response to the study, Greg Millett, vice president and director of public policy for amfAR, The Foundation for AIDS Research, said, “This is appalling … We've heard anecdotal reports about this conduct before, but this study shows a clear pattern of discrimination.”

Carl Schmid, deputy executive director of the AIDS Institute, the organization that filed a federal complaint against four insurers in Florida alleging discrimination against HIV patients, said the study is “more confirmation that this is happening, not only in Florida, but in other states as well.”

Patients deserve access to meaningful choices.  But, the reality is—as the study authors note—that plan designs like these can lead to a race to the bottom. 

Without changes that address these shortcomings, the current model threatens to leave chronically ill patients behind.