Have HIV? Your Health Insurance Company May Discriminate Against You

Since the Affordable Care Act (ACA) was signed into law in March 2010, more than 15 million Americans who didn’t have health insurance before the law have signed on. Expanded coverage, however, does not necessarily correlate with affordable pricing of drugs.

It is illegal for health insurers to discriminate against people with underlying medical conditions. However, companies appear to be bypassing the law and restricting access to drugs that treat certain conditions. Researchers at the Harvard School of Public Health examined 48 health plans in 12 states and found that a quarter of these plans used something called “adverse tiering,” for HIV drugs, that is, placing all HIV drugs in a high cost bracket where patients are responsible for paying at least 30% out of pocket.

Hippo Reads Medicine Correspondent Laura Christianson spoke with the Douglas Jacobs, a medical student at University of California, San Francisco, the first author on this paper, about what this study could mean for the future of healthcare

LC: What prompted you to look for differences in access to HIV drugs across the health insurance plans offered on the federal exchanges?

DJ: I am broadly interested in health policy and in my reading on the topic found an article describing a formal complaint submitted to the Office of Human Rights against four insurers in Florida that are putting HIV drugs on the highest cost sharing tiers. This led to the work that examined plans available nationally to see how pervasive the problem is.

LC: The larger question underlying your article seems to be how do we, as a country, want to pay for long-term, chronic care? How do you answer this question, taking into consideration the economic and human rights considerations involved in providing healthcare?

DJ: The Affordable Care Act (ACA) is based on the idea that U.S. citizens have the right to affordable healthcare. Before the ACA, those with chronic conditions couldn’t get insurance companies to take them on because their care was too costly. Personally, I think it’s problematic to deny access to healthcare to those who need it most.

Now insurers are required to insure patients with chronic conditions. However, our paper showed that insurers may be using their benefit designs to discourage enrollment. This may lead to a race to the bottom, in which insurance companies compete to exclude sick patients.

LC: You write about patients choosing insurance plans on the new federal marketplace exchanges. About 87% of Americans who aren’t on Medicare or Medicaid get insurance through employers. To what extent are these disparities also seen in employer-provided plans?

DJ: It’s hard to say without looking at those plans. What I can say is that, while employer based insurance is dominant now, the new individual market is projected to grow every year. I expect that the percentage of people who are insured on the marketplace will go up over time.

LC: At the end of your article, you mention that financial discrimination based on health status will likely continue and that ongoing oversight is required. How do you envision this oversight happening?

DJ: The Department of Health and Human Services recently finalized a regulation that categorizes adverse tiering as discrimination, thereby prohibiting it. This was an important step forward. However, the very fact that adverse tiering exists means that insurers still have the incentive to dissuade high cost enrollees from joining their plans. Insurers will invariably think of new ways to discourage the sick from enrolling, like increasing the costs of wheelchairs. Passing regulations that categorize certain practices as discrimination only after insurers are caught means that the regulators will always be one step behind.

The Office of Civil Rights, which is housed within the Department of Health and Human Services (HHS), is in charge of implementing and enforcing the nondiscrimination provisions of the ACA by passing regulations. To implement this part of the law, the Office of Civil Rights should write a regulation to broadly define discrimination in health care: Insurers should not be able to dissuade enrollment by increasing costs for certain populations, or restricting access to necessary medical services. A regulation that sets a legal standard over these issues would send a powerful message to insurers that discrimination will not be tolerated, and it would provide for a mechanism of enforcement through the justice system.

LC: What conditions besides HIV do you think would benefit from being placed in a “protected class”?

DJ: Putting a condition in a protected class is effective when there are specific classes of drugs associated with the condition. Previous research by Avalere shows that adverse tiering is seen in chronic conditions like schizophrenia, bipolar disorder, MS, diabetes, and asthma – these are conditions that would benefit from being protected. All of these conditions also have disease-specific classes of drugs and are costly to insure.

LC: Say you were the CEO of a large insurance company. How would you structure plans to ensure profitability?

DJ: If profitability were the only concern, then I’d use adverse tiering. If I had other competing objectives, such as social welfare or my company’s image, I’d try to structure my benefit design in a way that was more affordable to those with chronic conditions. Just last week, Aetna decided to move all of its HIV drugs off of the specialty tier, making them significantly more affordable.

LC: What excites you most about your findings?

DJ: I can’t say I’m excited about what we found. The fact that insurance companies are doing this means the incentive to discriminate based on chronic medical conditions remains and we have to eliminate other ways that insurance companies might be discriminating too.

LC: Do you plan to follow up on the research? If so, how?

DJ: I’m trying to! I’m keeping a closed mouth on the details, but I would like to. This is an untapped area of research and really important.

LC: How do your career aspirations jive with this research?

DJ: I’m going into my fourth year of medical school at UCSF, and I plan on following up with this research during that year since I’ll have a flexible schedule. When I graduate, I plan on doing a residency in Internal Medicine, and eventually want to be both a policy maker and practicing physician, maybe working in government policy.

LC: Were you interested in healthcare policy before medical school?

DJ: I’ve been interested in having an impact on healthcare system as a whole since college. After seeing patients during my third year of medicine, and how they often struggle to navigate our complicated system, that desire is even stronger now.

Further Reading:

• Avik Roy. Health Care and the Profit Motive. National Affairs. 2010.
• “Health Policy Brief: Risk Adjustment in Health Insurance.” Health Affairs. August 30, 2012.
• Douglas B. Jacobs, Sc.B., and Benjamin D. Sommers, M.D., Ph.D. Using Drugs to Discriminate — Adverse Selection in the Insurance Marketplace. New England Journal of Medicine. 2015.

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