The U.S. Department of Health and Human Services (HHS) has issued the Essential Health Benefits Bulletin outlining proposed policies that will give states more flexibility and freedom to implement the “essential health benefits” requirements of the Affordable Care Act (ACA).
ACA requires that health insurance policies offered in the individual and small group markets offer a comprehensive package of items and services known as “essential health benefits.” ACA identified at least 10 essential categories of items and services that must be included in a package of benefits: (1) ambulatory patient services, (2) emergency services (3) hospitalization, (4) maternity and newborn care, (5) mental health and substance use disorder services, including behavioral health treatment, (6) prescription drugs, (7) rehabilitative and habilitative services and devices, (8) laboratory services, (9) preventive and wellness services and chronic disease management, and (10) pediatric services, including oral and vision care. Moreover, the scope of essential health benefits should be equal to a “typical employer plan.” ACA directed the Secretary of HHS to further define essential health benefits.
Secretary Kathleen Sebelius is now proposing to pass the torch to the states to formulate this definition. For a two-year transition period in 2014 and 2015, the bulletin outlines that individual states would have the flexibility to select an existing health plan to set the “benchmark” for the items and services included in the essential health benefits package. States would choose one of the following health insurance plans as a benchmark:
- One of the three largest small group plans in the state;
- One of the three largest state employee health plans;
- One of the three largest federal employee health plan options; or
- The largest HMO plan offered in the state’s commercial market.
If a state does not exercise the option to select a benchmark health plan, HHS will consider the default benchmark to be the small group plan with the largest enrollment in the state. HHS intends to assess the benchmark process for the year 2016 and beyond based on evaluation and feedback.
The bulletin does not address cost-sharing features, such as deductibles, copayments, and coinsurance. The cost-sharing features will determine the level of actuarial value of the plan, expressed as specified in the ACA: bronze at 60 percent actuarial value, silver at 70 percent actuarial value, gold at 80 percent actuarial value, and platinum at 90 percent actuarial value. However, HHS intends to release guidance on these cost-sharing features in the near future.
A copy of the bulletin can be accessed here.
HHS has additionally developed a fact sheet which is available here.
Comments to the bulletin are due by Jan. 31, 2012, and can be sent to: [email protected].