Executive Order on Transparency Also Calls for Guidance Expanding HDHPs, Medical Expenses, and Health FSA Carryovers

The President has issued an executive order that is intended to improve price and quality transparency in health care. Among other things, the order calls for the following agency actions and guidance, consistent with applicable law:

• HDHPs. The Treasury Department (Treasury) is directed to issue guidance within 120 days that would allow high deductible health plans (HDHPs) to remain compatible with HSAs while covering medical care that helps individuals with chronic conditions maintain health status, before the deductible.
• Medical Expenses. Within 180 days, Treasury is to propose regulations to treat expenses related to certain arrangements, potentially including direct primary care arrangements and health-care sharing ministries, as eligible medical expenses under Code § 213(d).
• Carryovers. Treasury is also directed to issue guidance within 180 days to increase the amount that can be carried over after year-end under health FSAs.
• Transparency. HHS, Treasury, and the DOL are directed, within 90 days, to request comments on a proposal to require insurers and self-insured health plans (as well as providers) to make available information about expected out-of-pocket costs to patients before they receive care. Also, within 180 days, HHS is directed to increase access to de-identified claims data from group health plans (as well as taxpayer-funded healthcare programs) for researchers, innovators, and others, in a manner that ensures patient privacy and security.

EBIA Comment: The executive order does not change any laws or regulations, and its ultimate impact will not be known until the agencies issue the requested regulations and guidance. Nevertheless, sponsors of employer-provided health plans and their advisors will appreciate the heads-up that changes may be coming before 2020 along the lines addressed in the order. We note that employers and administrators have previously requested clarifications and guidance about some of these topics (e.g., pre-deductible HDHP coverage of medical care for chronic conditions and the status of payments for direct primary care arrangements under Code § 213(d)). And the transparency proposals may build on similar provisions included in the Affordable Care Act. For more information, see EBIA’s Consumer-Driven Health Care manual at Section X.G (“HSAs: Required HDHP Coverage—Preventive Care”), EBIA’s Cafeteria Plans manual at Sections XX.H (“Health FSAs Cannot Reimburse Insurance Premiums”) and XXI.H (“Carryovers and the Use-or-Lose Rule”), and EBIA’s Health Care Reform manual at Section XXXVI.F (“‘Transparency in Coverage’ Reporting and Cost-Sharing Disclosures”).

Contributing Editors: EBIA Staff.