Are there any health care victories in a large bill? Yes, a few…
When President Donald Trump signed a law earlier this month, medical groups' responses were overwhelmingly negative.
The law cuts Medicaid spending by hundreds of billions of dollars over the next decade and eliminates affordable care bill subsidies. Experts say the passage of the legislation will result in unpaid care costs, leading to hospital closures and reducing care opportunities, especially among rural hospitals and underserved populations.
But, among the melancholy, there are a few notable provisions that may contribute to meaningful advances in the health care sector.
Some promising health care policies within the bill include expanded telehealth access, new tax benefits for domestic health manufacturing, support for pharmaceutical research and an increasing opportunity for employers to innovate health benefits designs.
Improve telemedicine access
The law has a significant telemedicine victory. It permanently expands one dollar of telehealth coverage for high deductible health plans – meaning that those with these plans can be assured that their telehealth access will be covered before they encounter a deductible and keep their health savings account benefits.
The American Telehealth Association has advocated permanent expansion of telehealth insurance for the past five years, saying the change is a major milestone in telehealth.
“Permanently will provide certainty for healthcare providers and employers, improve health outcomes, enhance employer-sponsored health benefits and reduce disparities in care,” Kyle Zebley, senior vice president of public policy at the American Telehealth Association, said in a statement.
Caroline Savello, president of telemedicine company Color Health, famously said about half of the private workforce is involved in high-cost health plans.
She explained that high deductible health plans often end up avoiding care due to costs, so this change can remove critical barriers by pre-covering telehealth services.
“High deductions for health plans are often higher than the family savings on hand for patients. We know that the care sought in these health plans will generally be worse. [coverage extension] In particular, especially with access to a range of preventive health care services, as well as ongoing care for these programs, and through a truly cost-effective model, I think telemedicine has proven to be very, very feasible,” Savello said.
Over the past few years, employers have been reluctant to fully adopt or promote telehealth services due to regulatory uncertainty. Now, Savello believes they can confidently expand access to these services.
She noted that increasing telehealth access will help reduce overall health care costs, shifting care to high-cost settings and allowing people to get timely treatments more realistically before people’s conditions become more severe and expensive. Savello added that greater access will also lead to better quality of care in rural communities across the country.
She said telehealth has greatly improved opportunities with experts in rural areas, and healthcare infrastructure has declined rapidly in recent years. In many of these areas, hospitals have been closed and professional providers are scarce – making patients choose travel time or no care.
Virtual services can bridge the gap by connecting patients to their home or local clinic’s specialist care.
“We have seen cancer hospitals closed in rural areas and we are sure to see huge restrictions on access for cancer specialists. So it's very important to us and the employers we work with,” Savilo said.
By ensuring permanent coverage of telemedicine, the expansion will bring highly anticipated stability to virtual care.
Give employers a chance to shine
A Big Beautiful Act Act failed to expand tax credits for the Affordable Care Act or protect Medicaid insurance for enhanced innovative health benefits design for employers, especially in a tight labor market, noted Ben Light, vice president of partnerships at Zorro.
His company is a welfare platform that helps employers provide health coverage through the Health Reimbursement Arrangement of Personal Coverage (ICHRAS). Under these arrangements, employers provide workers with a fixed amount of pre-tax funds to purchase their own personal health insurance and pay for their health expenses.
“We are in a highly competitive labor market and now you have employees who will lose coverage through Medicaid or through the ACA and its expanded tax credits. They will look for places to seek support somewhere – I think they will seek support from their employers. If you are an employer, if you can find a way to contribute to people, then I think you’ll be a good announcement,” claiming you’ll do a good job. ”
He said employers can launch an ICHRA solution in just a few weeks, and doing so will provide much-needed support for employees who have lost coverage. He noted that Ichras could help reduce overall costs for employers by concentrating workers in individual markets.
Those savings explained by Bright can be reinvested in other benefits, such as direct primary care subscriptions. He highlighted the new provisions in the law that allow the use of health savings accounts for direct primary care – a model he believes is underestimated but valuable because they provide longer access and better access to doctors compared to traditional models.
“Now someone can have a 45-minute date or have more access to the doctor instead of being in and out of 10 minutes, maybe not getting the treatment they want,” Light said.
He added that this could represent a meaningful shift toward more personalized, proactive care.
He said it would be interesting to watch how employers can play a bigger role in keeping Americans healthy and underinsured.
Open country's medical manufacturing industry
Eric Axel, executive director of the American Medical Manufacturers Association, said the recently passed law was a “grand slam” for domestic medical manufacturers.
The legislation includes new funding and policy guidance for strategic state stocks, domestic reserves of personal protection equipment and other critical medical supplies. It also has new tax incentives for capital investment, R&D, and domestic production, which Axel believes will help maintain a competitive environment with heavily subsidized foreign competitors.
He said these competitors are China's most famous, receiving extensive government support, infrastructure and tax advantages – the United States has no historical allowance in history.
As the law passes, U.S. manufacturers can immediately write off costs of new machinery and facilities and deduct research and development expenses in the same tax year instead of spreading them over 15 years, Axel explained.
The law also lifts federal taxes on overtime pay, which will help companies grow manufacturing during a surge in demand.
“If you offer overtime, a lot of times, workers won’t accept it. They’ll say, ‘Oh, I just have to pay taxes, or it will throw me into another tax range.” So for hourly workers in these departments, there’s no tax on overtime – that’s a big deal.
From his perspective, a large Beauty Act marks a long-lasting federal commitment to rebuilding a medical manufacturing base in the United States.
Pharma sees some victories
Ahmed Elsayyad, Ostro's president and co-founder, noted that Pharma World's company is also tax cuts.
The new law revokes a provision of the 2017 Tax Cuts and Jobs Act, which requires domestic pharmaceutical companies to amortize their expenses within five years. Now, pharmaceutical companies and biotech companies can make the most of their domestic R&D costs in the year they incur.
Elsayyad noted that the change is particularly beneficial for early stage biotech companies.
“In the early stages of R&D, you simply don’t have any cash flow. For emerging biotech companies, being able to ensure you spend all your R&D expenses is huge, as it allows these companies to have more liquidity to invest in pipeline development and accelerate innovation timelines,” he said.
The law also permanently exempts drugs from at least one orphan name, meaning it will affect less than 200,000 people from rare diseases in the country with fewer than 200,000 people from CMS’s drug price negotiation program. Elsayad said Rare Diseases could see it as a huge win because the change could protect its drugs from government pricing pressures.
While the A Large Bill Act is basically disappointing in health care, these highlights of various stakeholders in these areas have a glimpse of potential advancements at a glance, and this is notoriously challenging landscape.
Photo: Mandel Ngan/AFP via Getty Images
