North Lancaster News

Washington, D.C. – On May 4, Reps. Smucker, Blumenauer (OR-3), Tenney (NY-24), and Schneider (IL-10) announce the introduction of the Primary Care Enhancement Act, H.R. 3029, bipartisan legislation designed to expand access to Direct Primary Care (DPC).

The legislation would clarify provisions of the Internal Revenue Code to remove barriers for individuals with Health Savings Accounts (HSAs) from using those funds to access DPC, a health care delivery model which provides high-quality care at lower cost for individuals of all ages and incomes across America.

“I am proud to collaborate with my colleagues on the Ways & Means Committee to introduce this bipartisan legislation to expand access to affordable primary care. As a former business owner that provided health insurance for over 150 employees, I know that innovative care delivery models like Direct Primary Care put patients in charge of their health, improve outcomes, and reduce costs for businesses and employees. Unfortunately, the Internal Revenue Service’s interpretation of current tax law prevents individuals with Health Savings Accounts (HSAs) from accessing DPC, even when their colleagues without HSAs can do so. I am thankful for my colleagues’ support of this bipartisan legislation to expand access to DPC,” said Congressman Smucker.

“Direct Primary Care is a model proven to improve patient outcomes and experiences,” said Congressman Earl Blumenauer (OR-03). “This legislation removes unnecessary barriers in the tax code to allow more people to access high-quality services while saving money. I look forward to working with Congressman Smucker on this important bipartisan legislation.”

“Direct Primary Care (DPC) is an innovative monthly membership-based payment plan that helps reduce health care costs while providing high-quality primary care to patients,” said Congresswoman Tenney. “DPC is a popular option for upstate New Yorkers and promotes a strong and trusting relationship with health care providers. The bipartisan Primary Care Enhancement Act removes the tax barrier that inhibits patients with Health Savings Accounts (HSAs) from reaping the benefits of DPC. I will always be a champion for legislation that promotes health care flexibility and affordability.” 

In addition to introducing the Primary Care Enhancement Act, Smucker has cosponsored H.R. 2884 the Medicaid Primary Care Improvement Act, which would grant state Medicaid programs the ability to broaden health care access for beneficiaries by allowing the use of direct primary care services. Allowing states to innovate with direct primary care in their Medicaid programs will keep patients out of the emergency room, improve health outcomes, and yield savings. 

Background:

• DPC is a health care delivery model that reduces costs and improves access to primary care. Employers report up to 20% savings on the total cost of care for their employees, by providing better health care up front in the primary care setting, reducing unnecessary hospital and specialty care, and drastically reducing administrative expenses.
• More than twenty states have passed laws defining DPC care as a medical service and not a health insurance plan. Likewise, Department of Health and Human Services (HHS) rules on Essential Health Benefits clearly state that DPC arrangements are medical services, not health insurance.
• Currently, the Internal Revenue Service (IRS) prohibits individuals with HSAs from funding their accounts if they have a DPC arrangement. Furthermore, individuals cannot use their existing HSA dollars to pay for the monthly or annual DPC fees as qualified medical expenses.

Primary Care Enhancement Act:

• The Primary Care Enhancement Act clarifies two provisions in the Internal Revenue Code that currently treat these innovative payment arrangements for employees and individuals as health insurance rather than medical services. The bill would allow patients using DPC to contribute to their HSAs and use HSA funds to pay for direct primary care fees.
• The Primary Care Enhancement Act has twice been favorably reported out of the Ways & Means Committee with bipartisan support in prior Congresses.
• Senate companion legislation, S.628, is sponsored by Sens. Bill Cassidy, Jeanne Shaheen, Tim Scott, and Mark Kelly.

Support for the Primary Care Enhancement Act:

“Direct primary care arrangements are an important tool used by employer-sponsored plans to foster improved access to primary care and preventative services, which in turn can lead to less acute or costly conditions and fewer visits to the hospital. The Corporate Health Care Coalition applauds the introduction of the Primary Care Enhancement Act, which will remove barriers to this innovative solution to bring more accountability into health care delivery and drive better health outcomes,” said Kate Hull, Executive Director, Corporate Health Care Coalition.

"The AAFP supports direct primary care (DPC) and its ability to provide a pathway to continuous, comprehensive and coordinated primary care for patients. However, physicians and patients face legal and financial roadblocks that prevent them from fully embracing this model. Family physicians are proud to endorse the Primary Care Enhancement Act, which will allow health savings accounts funds to be used to pay for DPC arrangements. This will help improve access and allow more patients to receive care in a DPC model,” said Tochi Iroku-Malize, MD, MPH, FAAFP, President, American Academy of Family Physicians.

"Many thanks to Reps. Lloyd Smucker and Earl Blumenauer for reintroducing the bipartisan Primary Care Enhancement Act (H.R. 3029). The Direct Primary Care Coalition strongly supports this legislation which fixes a significant federal policy roadblock keeping individuals from selecting a physician of their choice in a direct primary care (DPC) agreement. You can use your HSA to buy aspirin or eyeglasses, but not for primary care if you have a DPC agreement.  So, this bill clarifies that pre-tax HSA funds may be used to pay monthly fees for primary care through a DPC agreement,” said Jay Keese, Executive Director, Direct Primary Care Coalition.

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Issues: Economy & Jobs Health Care Tax Reform

Original source can be found here.