In late June, a draft of an executive order, entitled “Reducing the Cost of Medical Products and Enhancing American Biomedical Innovation”, emerged that would update IRS Section 223 (c)(2)(C).  Section 6 of the order states:

“The Internal Revenue Service shall update the preventive care safe harbor under

Section 223 of the Internal Revenue Code to include services or benefits, including

medications, intended to prevent chronic disease progression or complications,

for the purpose of helping patients adhere to clinical regimens and thereby

reducing costs of healthcare.”

This amendment to the IRS code would provide health savings account eligible high-deductible health plans (HSA-HDHPs) the flexibility to cover services and drugs used to treat chronic diseases before meeting the plan deductible.

What does this mean, and why is it important?

This executive order would allow for the development and implementation of High-Value Health Plans.  Adoption of this voluntary, clinically nuanced HVHP has the potential to mitigate cost-related non-adherence, enhance patient-centered outcomes, allow for premiums lower than most PPOs and HMOs, and substantially reduce aggregate health care expenditures.  The HVHP would provide millions of Americans a plan option that better meets their clinical and financial needs.

View the resources below for more information on HVHPs.


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