A Benefit Floor for All Health Plans
The Affordable Care Act (ACA) includes the following categories meant to set a benefit floor for all health insurance plans from 2014 going forward:
- ambulatory patient services
- emergency services
- hospitalization
- maternity and newborn care
- mental health and substance abuse disorder services, including behavioral health treatment
- 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
HHS Passes to States
It was expected that Department of Health and Human Services (HHS) regulations would further specify essential benefits at the federal level, but in mid-December 2011 HHS announced that it was passing the responsibility for defining essential benefits to the states.
In California, that gives state leaders - the legislature as well as the California Health Benefit Exchange Board- more control of health insurance. It remains to be seen whether this is a blessing for Californians. Will the shifting of responsibility to the state ease implementation of the Exchange or burden it further? Will health insurance costs be controlled or spike higher as a result of additional benefit mandates demanded by powerful consumer groups and special interests like hospitals and pharmaceutical companies.
Benefit Plan Benchmarks
The HHS guidance says states can define their own set of essential benefits by using an existing major health benefit plan in the state as a benchmark. California benchmarks would include one of the three largest federal employee health benefit plans by enrollment, one of the three largest state employee health benefit plans by enrollment, one of the three largest small business plans by enrollment, and the largest HMO plan offered in the state’s commercial market by enrollment. Many fear these federal and state employee benefit benchmarks set the bar too high, and the largest HMO plan offered in the state’s commercial market by enrollment. These plans are more comprehensive and thus more expensive than most individuals and small businesses can afford.