Insurance Fairness Acts Help to End ‘One Limb Per Lifetime’ Restrictions

Prior to the passing of the Affordable Care Act, several states began passing insurance fairness legislation for amputees because insurance companies that covered prostheses and custom orthoses had monetary caps and “one limb per lifetime” restrictions that hindered patients from getting the care they needed.

“There is an argument that a person can have as good of a life in a wheelchair as they can if they have a prostheses,” Ashlie White, board member for the National Association for the Advancement of Orthotics & Prosthetics (NAAOP), told O&P Business News. “That may be very true. I know some patients who choose to be in a wheelchair and that is fine. That is their choice. But it should be a choice. If someone wants to go back to work and it requires them to be on their feet, then they need a prosthesis to do that. We are talking about people’s access to care being limited because of a few words that aren’t explicitly listed as essential benefits.”

However, even after the Affordable Care Act (ACA) came into law, many states still do not have an insurance fairness law and even efforts to have a federal insurance fairness law passed have come to a halt.

Insurance fairness laws

To prevent insurance companies from excluding coverage of prosthetics and custom orthotics or offering coverage with caps and restrictions, the first legislation for the Insurance Fairness for Amputees Act passed in Colorado in 2001.

“Colorado got [the law] passed using economic data suggesting that putting a prosthesis on a patient with limb loss ended up saving the state money over the long haul,” Dave McGill, vice president of reimbursement at Össur, said. “With the passage of that law, there was the realization that this was the kind of legislation that we might be able to drive through other states.”

Since Colorado, the Amputee Coalition and other groups have helped 20 states pass insurance fairness laws, with the majority of the laws being passed in 2008 and 2009. But with the implementation of the ACA in March 2010, there has been a lull in any more states passing similar laws.

“The reason that we were able to pass a number of laws before the ACA in 2008 and 2009 was because health care reform was not a big topic of interest,” Dan Ignaszewski, director of government relations at the Amputee Coalition, told O&P Business News. “Since the ACA and federal health care reform started progressing in 2009 and 2010, we saw drop-off in states taking an initiative to try to fix problems with health care systems and insurance because they were waiting to see what was going to happen with the ACA and whatever the federal health care changes were going to be. Even after the law was passed and signed into law, a lot of states waited to find out whether the law would stay intact after it was challenged in the Supreme Court.”

Around the same time the states were setting insurance fairness laws into motion, the Amputee Coalition was working on getting a federal version of the Insurance Fairness for Amputees Act passed.

“Ultimately, I do not think the ACA solves all the problems that the [Insurance Fairness for Amputees Act] is designed to address,” Peter W. Thomas, JD, general counsel of the NAAOP, said, “and this is why NAAOP supports that federal legislation. The ACA says that essential health benefits include “rehabilitation devices” covered by the “typical employer plan.” This translates into pretty reliable coverage of orthotic and prosthetic care in private health plans. The Insurance Fairness Act goes a step further by requiring any private plan that covers O&P care to do so without arbitrary exclusions and limitations like covering “one prosthesis per lifetime.” Under the Fairness Act, health plans would need to cover orthotics and prosthetics to the same extent they cover other benefits, particularly medical and surgical benefits.”

Although individual states are working on passing insurance fairness laws, it is important to also have a federal law to cover insurance fairness in self-insured plans, which are used in at least half of the market. Self-insured health plans, usually adopted by large, multi-state businesses, are not subject to state insurance laws so a federal law is necessary to impact them.

“The fairness act would be a belt and suspenders kind of approach to make sure that not only do private health plans cover orthotics and prosthetics, which is largely required by the ACA, but that they cover orthotics and prosthetics without arbitrary limitations and exclusions and at reasonable coverage levels,” Thomas said. “The combination between the Insurance Fairness Act and the ACA is a pretty powerful combination, which is why the O&P community needs to continue to push for the federal Fairness Act.”

Now that the ACA is federal law, the industry is urging states and the Congress to move forward with insurance fairness. By eliminating caps and unreasonable restrictions in coverage, amputees will be able to obtain prosthetic and custom orthotic care that some insurance companies may not cover, such as microprocessor components, and will be able to live a more fulfilling life.

“We don’t want this profession to get to a place where you have a limited list of components that you can provide for the patient and that is all you can do,” White, who is also director of government affairs for the North Carolina Orthotics and Prosthetics Trade Association, said. “The services provided are so much more custom, so much more personal than a simple list can account for, and I believe insurance fairness is a step toward securing and protecting access to the appropriate devices for our patients.”

Essential health benefits

Under the ACA, each “qualified health plan” must offer a minimum of 10 essential health benefits. While prosthetics and custom orthotics are not specifically listed as an essential health benefit, “rehabilitative and habilitative services and devices” are included in the statute and are meant to help patients with injuries, disabilities or chronic conditions gain or recover physical skills. According to Ignaszewski, although several statements were made on the House of Representatives floor indicating prosthetics and custom orthotics were included under rehabilitative and habilitative services and devices, many states still have dollar limits and other restrictions and caps on it, even though annual and lifetime caps are not allowed on health care services labeled “essential.”

“The states were given the opportunity to choose their benchmark plans for which the insurance exchanges will be based off in those states and they were able to say what categories and benefits were explicitly covered under the essential health benefits,” Ignaszewski said. “Almost every state has some level of coverage for prosthetic and custom orthotic devices. That is the good news. The bad news is a lot of those states still provide insurance companies an opportunity to put caps or restrictions on services.”

Before choosing their benchmark plan, each state is required to make sure the plan complies with the ACA through the categories of benefits that must be offered and that the plan does not discriminate in benefit design.

“[The benchmark plan in each state needs to] meet those categories of benefits that must be offered. If the benchmark plan in a particular state does not meet those benefits, it needs to add those to the benchmark plan,” Thomas said. “[The state] needs to make sure [the plan] doesn’t discriminate in benefit design or anything else along those lines based on disability or age or some other factor… [A state] cannot design its benefits package so that it omits any of the categories of benefits that are listed in the statute, and rehabilitative and habilitative services and devices is one of those categories.”

Currently, New York is one state that has a one prosthesis per lifetime maximum under their benchmark plan, according to McGill, while other states have dollar limitations and limitations on types of components, such as microprocessor components.

“If you actually went and spoke to New York State officials, the answer would likely be that they had no idea that the benchmark plan they selected had any kinds of restrictions on prosthetics because it wouldn’t have been something they were spending any time focusing on,” McGill said. “When we look at how to address these kinds of issues moving forward, I think organizations like the Amputee Coalition and its members in the states where these kinds of limitations exist are going to have to highlight [these issues] for government officials so we can leverage the provisions of the Affordable Care Act to protect amputees from the kinds of limitations and restrictions that law was designed to prevent.”

Ignaszewski said to remove caps and restrictions on prostheses and custom orthoses, the O&P industry needs to work on bringing attention to prostheses and custom orthoses as an essential health benefit and work on passing more insurance fairness laws in other states.

“Essential health benefits is a major issue,” Ignaszewski said. “If we are able to get prosthetic and custom orthotic devices included in every state’s essential health benefits plan, [then] it will go a long way in eliminating the caps and restrictions on care.”

Education of the masses

To continue pushing for insurance fairness laws at a state and federal level, it is important to educate the referral sources, payers, policymakers, legislators and patients on how prostheses and custom orthotics can not only help patients become more mobile, but help with economic savings as well.

“We had in the back of our minds for some time the feeling that while we all know in the profession that [orthotic and prosthetic] interventions and procedures add value in terms of getting a better outcome, what we also suspected was that along with the value there was an economic savings,” Tom Kirk, immediate past president of the American Orthotic and Prosthetic Association (AOPA), told O&P Business News.

In August 2013, under the request of AOPA and the Amputee Coalition, Dobson DaVanzo released a study of statistics from the Medicare database that showed patients who received O&P care, specifically lower extremity orthoses, spinal orthoses and lower extremity prostheses, were more likely to remain mobile, increasing their chances of being independent and not bedbound, while decreasing emergency room admissions and acute care hospital admissions. Overall, the report showed that within 12 months to 18 months the Medicare cumulative costs for the patients receiving the O&P services were less than those for the patients not receiving O&P services.

From these results, AOPA and the Amputee Coalition have begun a program called the Mobility Saves Awareness project, which will help educate the five audiences about O&P advancements and benefits from clinical, technical and economic perspectives through the Dobson DaVanzo report and presentations, both of which can be found on the Mobility Saves website, which was launched in July. Through the website, visitors can leave feedback on their experiences and other steps AOPA should take to help educate.

“I think some decisions have been made not with the intent of hurting any patient population, but more about saving money and not realizing the consequences,” Kirk said. “The Mobility Saves project will show that, in fact, is the wrong way to save money. That is being pennywise and dollar foolish. I think showing them that clinically and economically we can justify the full investment, could change the thought patterns on insurance fairness. Artificial dollar limitations and lifetime cap limitations end up costing payers and the entire economy a lot more money than if you had made the upfront investment.”

“What Mobility Saves is going to do is push back on the rather myopic thinking that if I save a buck today I can put that in my pocket,” he said. “The real message here is if you save a buck today you are probably costing yourself two or three dollars or even more down the road.”

However, education is not the only important step in insurance fairness. It is also important to enact O&P licensure laws to make sure that O&P providers and suppliers are qualified to provide complex patient care and that no one can abuse the insurance system. Currently, 16 states have licensure laws, but, similar to insurance fairness, there has been a slow down on the number of states adopting licensure laws in recent years.

“Once you have coverage by insurance companies of the benefit itself, you want to make sure the people who provide that benefit are qualified to do so and that you have limitations on fraudulent and abusive activities,” Thomas said. “In many states, you need a state license to be a barber, but you can provide an artificial limb to someone and bill an insurance company thousands of dollars and there is no requirement that the person be licensed. The licensure aspect of this set of issues is important as well.” — by Casey Tingle

Disclosures: Ignaszewski, Kirk, McGill, Thomas and White have no relevant financial disclosures.