While the Patient Protection and Affordable Care Act (PPACA) continues to be an unsolved puzzle for employers and insurance providers, the law is moving forward and the pieces are slowly beginning to come together.
Almost a year after broadly defining Essential Health Benefits (EHB), the U.S. Department of Health and Human Services (HHS) recently filled in a few more pieces of the puzzle by issuing a detailed set of proposed rules that will determine the required components that must be offered beginning in 2014 through all non-grandfathered health plans, mainly in the individual and small group markets.
What are Essential Health Benefits?
EHB are those benefits that must be included in health insurance plans starting in 2014. PPACA defines EHB by establishing 10 categories of benefits that must be covered by all health insurance plans offered through an exchange:
- Ambulatory patient services
- Emergency services
- Maternity and newborn care
- Mental health and substance abuse disorder services
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventive and wellness services and chronic disease management
- Pediatric services, including oral and vision care
The EHB regulation allows states some flexibility in basing their minimum benefits on “benchmark plans” offered in the states. These plans are typically the largest small group commercial plan offered or the largest HMO, but could also include any of the three largest state employee benefit plans or any of the three largest federal employee benefit plans. If a state doesn’t select its own benchmark, the federal government will use the largest small group commercial plan as the default.
HHS says its EHB regulatory approach has several goals:
- Encompass the 10 categories of services identified in PPACA.
- Reflect typical employer health benefit plans.
- Reflect balance among the categories.
- Account for diverse health needs across many populations.
- Ensure there are no incentives for coverage decisions, cost sharing, or reimbursement rates to discriminate impermissibly against individuals because of their age, disability, or expected length of life.
- Ensure compliance with the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA).
- Provide states a role in defining essential health benefits.
- Balance comprehensiveness and affordability for those purchasing coverage.
While PPACA is still a puzzle with many missing pieces, the new proposed rules and guidelines from HHS will help employers and insurance brokers take the next step toward planning for 2014.
For more detailed definitions and information regarding Essential Health Benefits, go to http://www.healthcare.gov/glossary/e/essential.html. To stay up to date on the proposed rules from HHS, visit their website at http://www.hhs.gov/.