Activity-Specific O&P Coverage for Kids: The Legal Question

A 2022 Maine bill that granted enhanced prosthetic coverage to children with limb loss was a major impetus for a campaign encouraging other states to pass laws that clarify insurance coverage of activity-specific prostheses and orthoses. This culminated in the creation of the So Kids Can Move (SKCM) initiative. Soon after similar legislation was introduced in additional states, some state legislative champions began questioning why the bill’s benefits ended at age 18 or 21. When multiple states began introducing similar bills applicable to individuals of all ages, the campaign recognized the reality and the promise of a broader approach.¹ The So Every BODY Can Move (SEBCM) initiative was then formalized, a modified campaign to improve coverage of activity-specific prostheses and orthoses for individuals of all ages.

This article explores the factors state legislative champions and SEBCM advocates must consider when determining whether to introduce legislation applicable to people with limb loss and limb impairment of all ages or whether to confine the scope of the legislation to children alone. The decision turns on federal nondiscrimination protections based on age, the fiscal pressures and realities in each state, and the facts and circumstances within each state where these laws are being considered.

In addition to Maine, New Hampshire, Colorado, and Indiana either started out with or still have state SEBCM laws that apply only to children and young adults, up to the age of emancipation. Some state legislative counsel offices have raised concerns that such an age limitation may conflict with federal nondiscrimination laws. Discrimination in health insurance based on age derives from Section 1557 of the Patient Protection and Affordable Care Act (ACA). This is the primary antidiscrimination provision of the ACA and prohibits discrimination in certain health programs or activities on the basis of race, color, national origin, age, disability, or sex. Also applicable are other aspects of the ACA that pertain to nondiscrimination in essential health benefit (EHB) plan design.²

The legislation in Maine, New Hampshire, Colorado, and Indiana is age limited, restricting activity-specific benefits to children 18 years of age or younger, and thus raises the question of whether the ACA’s prohibition against age discrimination conflicts with or invalidates this legislation. The answer is complicated. While the limitation to children does not appear to violate Section 1557, any such limitation must be evidence-based to pass muster under the EHB nondiscrimination section barring discrimination based on age.

Section 1557 Permits Age Distinctions

Section 1557 has broad application, covering any plan that (1) receives federal financial assistance from the government and (2) is principally engaged in the provision or administration of certain health programs or activities. These qualifying programs or activities are described in law as “providing or administering health-related services, health insurance coverage, or other health-related coverage.”³

Under Section 1557, it is permissible for the federal government, or states, to adopt new health insurance laws that incorporate age distinctions. One example of permissible age-distinctive laws on the federal level is the Early and Periodic Screening, Diagnostic, and Treatment benefit under Medicaid. This program provides comprehensive, preventive healthcare for Medicaid enrollees under the age of 21. Similar to this example, the activity-specific O&P laws in Maine, New Hampshire, Colorado, and Indiana—each of which contain an age-based limitation—do not appear to run afoul of Section 1557. In fact, a US Department of Health and Human Services Frequently Asked Questions document published in 2017 clarifies that the Section 1557 regulations “do not apply to age distinctions contained in State or local statutes that were adopted by an elected, general purpose legislative body.”⁴ In other words, such legislation applicable to children and young adults only would not violate Section 1557 “because it is authorized under State law.”⁵

Age Restrictions and EHB

While activity-specific O&P device legislation containing age restrictions does not violate Section 1557 of the ACA, other, more specific nondiscrimination requirements also apply to EHB design, and these requirements pertain to, among other things, age. For instance, Section 156.125 of the ACA states:

(a) An issuer does not provide EHB if its benefit design, or the implementation of its benefit design, discriminates based on an individual’s age, expected length of life, present or predicted disability, degree of medical dependency, quality of life, or other health conditions. Beginning on the earlier of January 1, 2023, (the start of the 2023 plan year) or upon renewal of any plan subject to this rule, a nondiscriminatory benefit design that provides EHB is one that is clinically based.⁶

These EHB age discrimination provisions prohibit age distinctions if the service or treatment is clinically effective for all ages, which is a clear challenge to the SKCM’s limitation to children of the expanded scope of activity-specific prostheses and custom orthoses. Clearly, adults can benefit from activity-specific O&P care as well as children. The EHB regulations also offer categorical examples of presumptive age discrimination including the following:

• Limitation on hearing aid coverage based on age
• Autism spectrum disorder coverage limitations based on age
• Age limits for infertility treatment coverage when treatment is clinically effective for the age group
• Limitation on foot care coverage based on diagnosis (whether diabetes or another underlying medical condition)
• Access to prescription drugs for chronic health conditions

The example pertaining to hearing aid coverage is very similar to coverage of activity-specific O&P care for children only. The SKCM legislation purports to expand the scope of an existing EHB benefit, i.e., custom orthotic and prosthetic devices, the benefit category for which is listed in the ACA as “rehabilitative and habilitative services and devices.”

Creating a benefit mandate not considered to be included in EHB would require the state to supplement the cost of this new benefit, known as defrayal. In other words, states must defray the costs of subsidies paid for by the federal government when that state mandates coverage of benefits not already covered by the EHB.

When Age Restrictions Are Justified

It is a reasonable argument to assert that prostheses and orthoses are already included in EHB and, therefore, the benefit design to cover activity-specific O&P care must not discriminate based on age. This argument can be used by advocates to argue that states must apply coverage of activity-specific orthoses and prostheses to privately insured people of all ages.

If, however, O&P advocates, working with state legislative champions, wish to assert that the state can, in fact, limit this benefit to children to limit the cost of the bill and thereby achieve passage of the legislation in the first place, an evidence-based rationale must exist to demonstrate why the limitation to children is justified. In fact, there is evidence that suggests that children who are not active nor exposed to sports and athletic activities before age 12 are far less likely to exercise and stay fit later in life. This and perhaps other research involving childhood obesity and the long-term implications of a sedentary lifestyle at a young age could formulate a clinically based rationale for limiting this benefit to children without violating the EHB age discrimination requirements.

Obviously, it is preferable for states to adopt new laws that clarify coverage of activity-specific prostheses and orthoses for all ages rather than limiting coverage to children and young adults. But the financial status of some states precludes adoption of such expansive laws all at once. In these instances, state champions and advocates can argue that the true costs of activity-specific prostheses and orthoses are quite reasonable and estimates to the contrary are overblown. But if this argument is not persuasive, it is legally permissible, based on the above analysis, to limit these laws to children and young adults at first, to get a foothold in the state and return at a later time to lift this age exclusion to apply to individuals of all ages. This enables the state to better track and understand the true costs of this benefit and to factor this into broader coverage of individuals with limb loss and limb impairment of all ages in future years.

Conclusion

States grappling with resistance to SEBCM legislation due to the perceived cost of the legislation should develop an evidence base to argue that the legislation to expand the scope of activity-specific prostheses and orthoses can be limited to children only without violating federal nondiscrimination laws based on age. If successful, this will enable state advocates and state legislative champions to have maximum flexibility when working with their state’s legislature to determine how far the legislature is willing to go to expand the scope of the O&P benefit under private insurance plans, either to children alone or to enrollees of all ages.

Peter W. Thomas, JD, is managing partner at Powers Law Firm, Washington DC, NAAOP general counsel, and counsel to the O&P Alliance. Hannah Hauer, JD, is an associate at Powers Law Firm.

References

1. The campaign known as So Every BODY Can Move was originally conceived by the National Association for the Advancement of Orthotics and Prosthetics (NAAOP) and the American Orthotic and Prosthetic Association (AOPA), and inspired by Nicole ver Kuilen, who now leads this initiative. It is now run by the Amputee Coalition in partnership with NAAOP, AOPA, and the American Academy of Orthotists and Prosthetists. The American Board for Certification in Orthotics, Prosthetics, and Pedorthics (ABC) is also a major supporter.
2. Section 156.125 of the federal EHB regulations.
3. Federal Register: Nondiscrimination in Health Programs and Activities at 47,826-27.
4. Section 1557: Frequently Asked Questions | HHS.gov; (published May 18, 2017).
5. Section 1557: Frequently Asked Questions | HHS.gov.
6. HHS Notice of Benefit and Payment Parameters for 2023, Final Rule; 87 FR 27208, 27301-05, May 6, 2022.

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