Insurance Coverage for Medical Foods

By Ronald L. Scott

A number of states are considering, or have enacted, laws that mandate insurance coverage for "medical foods" that usually, at a minimum, require coverage for special dietary formulas for individuals with phenylketonuria (PKU) or other heritable diseases. Such statutes often require health insurance plans to cover medical foods to the same extent as prescription drugs.

PKU is an inherited condition that causes severe mental retardation if not treated. PKU affects the way the body processes protein. Children with PKU cannot process a part of the protein (phenylalanine) and phenylalanine builds up in the bloodstream causing brain damage. Left untreated, individuals with PKU become severely retarded, usually requiring lifetime institutionalization costing tens of thousands of dollars per year. Screening and treatment for PKU is considerably less expensive than the cost of providing care for untreated, retarded individuals. Every state mandates PKU testing. Mandatory newborn screening allows almost all affected newborns to be diagnosed and treated early, preventing mental retardation. In the U.S., about one baby in 10,000 to 25,000 is born with PKU.

Mental retardation associated with PKU can be totally prevented if the baby is treated with a special diet that is low in phenylalanine begun in the first three weeks of life. At first, the baby is fed a special formula. Later, other low-phenylalanine foods are added to the diet. Children with PKU require an individualized diet, depending on how much phenylalanine they can tolerate, age, weight and other factors. See March of Dimes PKU Public Health Information Sheet available at

Critics of health insurance benefits legislation believe that mandates lead to an increase in the cost of premiums, ultimately increasing the number of uninsured individuals. Proponents of such legislation argue that they are necessary to ensure adequate benefits for consumers. A Texas Department of Insurance December 1998 report to the Texas Legislature addresses the impact of mandated health benefits. The report found that a number of studies conclude that factors other than mandated benefits are mainly responsible for increasing uninsured rates.

States have adopted a variety of approaches in requiring insurance coverage for medical foods. For example, Maine requires HMOs and individual insurance policies to provide coverage for formula and medical food products for persons with inborn errors of metabolism (coverage for low-protein food products may be capped at $3,000). Me. Rev. Stat. Ann. tit. 24, § 2320-D, tit. 24-A, §§ 2745-D, 2837-D, 4238.

Massachusetts requires HMOs to cover nonprescription enteral formulas for home use when ordered by a physician and medically necessary. The coverage must include low protein food products, but may be capped at $2500 annually. Mass. Gen. Laws Ann. ch. 176A, § 8L, ch. 176B, § 4K, ch. 176G, § 4D. Nevada has a similar statute. Nev. Rev. Stat. § 695C.1723. North Dakota requires coverage by insurers, health service corporations, and HMOs for medical foods and low protein modified food products with a cap of $3,000 annually and coverage limited to individuals born after December 31, 1962. N.D. Century Code § 26.1-36-09.7. Other states with statutes mandating coverage include Oregon, Utah, Vermont, and Washington. See Or. Rev. Stat. Ann. § 743.726, Utah Code § 31A-22-623, Vt. Stat. Ann., tit. 8 §, 4089e, and Wash. Rev. Code § 48.46.510.