Should the parents of a child covered under health care reforms who can’t make out the writing on a classroom chalkboard be able to buy Tag Heuer frames? How about a pair of Fendis? Or maybe Guccis?
The federal government says it’s not likely. After all, those are all high-end brands that retail for hundreds of dollars, a price far higher than what most would view as practical and certainly outside the spirit of the Patient Protection and Affordable Care Act (PPACA). Yet, because of a lack of specificity in the law, concerns are running high about the potential for confusion and perhaps even abuse of the pediatric vision care provisions of PPACA.
The law, meant to bring health coverage to the estimated 30 million uninsured Americans, moves into high gear this fall, when people will be able to buy coverage via new insurance exchanges.
About half the nearly 30 million uninsured people expected to gain coverage under PPACA would do so through Medicaid. Its expansion would cover low-income people making up to 138 percent of the federal poverty level, about $15,860 for an individual.
Insurers and others with a stake in the outcome have been rushing to clarify the rules – on voluntary as well as core benefits – and come up with health benefit plans that comply with the federal standards.
It’s a complicated undertaking. For starters, PPACA says “dependent children” may stay on their parents' health insurance until age 26 but it doesn't specify eligibility guidelines for pediatric benefits, leaving the decision to states.
Pediatric vision services are one of the 10 essential health benefits that all health plans will need to offer if they hope to market themselves in the exchanges, which are supposed to start operating in October for health plans that go into effect in January.
That’s when, under PPACA, all individual and small groups with 50 or fewer employees must provide pediatric vision care coverage as part of their medical benefit for children up to age 19.
Like the other essential health benefits, no annual or lifetime dollar limits are allowed on vision services.
Making matters more difficult, each state is allowed to specify benefits within each of the essential categories, at least for 2014 and 2015. As a result, benefits no doubt will vary from state to state, contrary to what many Americans had assumed when the law was adopted in 2010.
Jeff Spahr, president of WellPoint’s vision business, said the Indianapolis-based insurer has been fielding plenty of questions from employers about whether their vision plans will need to change in light of the law.
WellPoint, as any carrier would agree, views vision care as a high-value benefit that can help lower medical costs and boost productivity, as well as help companies attract and retain employees.
Spahr points to a survey by Transitions Optical that found that providing eye care for their family is one of the top reasons employees enroll in a vision plan, and that three in four full-time parents with access to their company’s vision benefit choose to enroll in it.
But because government regulators left “pediatric vision care" largely undefined, there’s concern about what might end up being covered and what might not.
As Spahr noted in a recent article, Colorado’s benchmark medical plan includes a pediatric eye exam, but no eyewear materials.
Connecticut, on the other hand, has decided on an annual exam for children and adults, plus annual eyeglasses or contacts for children.
Historically, vision plans, whether stand-alone or part of medical coverage, have used allowance-based benefits to cover glasses and contacts. For example, a plan would allow its members to spend $130 to buy frames or contacts.
In other words, they come with a limit on how much a covered individual can spend on frames. Buying more expensive eyewear or contacts typically means reaching into your own pockets to cover any costs beyond the cap.
But, again, PPACA places no annual maximum on essential health benefits.
“It really does change how the industry operates when allowance-based essential health benefits are not allowed,” Spahr said. “A ‘no out-of-pocket limit’ rule for materials could be interpreted as meaning patients will have their pick of the highest-end frames and lenses with all the trimmings.”
Left unaddressed, that potentially could lead to a nation filled with children who might be among the poorest but who, thanks to PPACA, are wearing the latest fashion eyewear.
“That’s not the intent of health care reform,” Spahr said. “Nor would we want to pay out such claims.”
WellPoint and other insurers have been looking at how best to address the issue.
Possible solutions lie in adopting an approach common in the pharmacy world, where certain, typically more expensive, prescription drugs might not be covered when generic medications are readily available.
“We’re not talking about defining materials by dollar limits,” Spahr said. “But we’d identify certain frames that are covered and say to consumers, ‘Here’s a reasonable collection of frames.’ It’s just not opening it up to a thousand choices.”
“We want a consumer-friendly solution,” he added.
Insurers aren’t alone in their concern.
“No one will underwrite (a pediatric vision benefit) without limit,” said Dr. Michael X. Repka, the American Academy of Ophthalmology’s medical director for governmental affairs.
“I think the benefit is a great thing for children. What I’m hoping is that the right controls and limits will be put in so that it doesn’t become a benefit that is unaffordable.”
While PPACA didn’t establish a national standard on this question, it does say that essential health benefits should “be equal in scope” to benefits offered by a typical employer plan.
“Typical,” of course, isn’t easy to define, so the federal Department of Health and Human Services is hoping insurers and state lawmakers who hash out the details rely on what it’s calling a “benchmark” plan, ideally the largest small group plan in any given state.
Cost limits aside, Spahr said he’s glad PPACA makes it clear vision care remains an essential benefit.
“It really reinforces, on the positive side, how important vision care is, particularly for children. I think 80 percent of learning happens visually. If you can’t see well, you can’t learn well.”