On December 16th, the federal government released the first of its long awaited statements on the essential health benefits (EHB) package. The Affordable Care Act (ACA) lists 10 categories of health care benefits that must be included in the EHB and requires that the EHB’s scope be equal to the scope of benefits offered under a “typical employer plan.” In 2014, non-grandfathered plans in the individual and small group markets both inside and outside of the Exchange, Medicaid benchmark and benchmark-equivalent, and Basic Health Programs must all cover the EHB.

Consumers, including CCHI, have urged HHS to propose a robust, national package. However, HHS avoided that difficult task and instead gave the states the flexibility to pick from a set of specific benchmark plans. The benchmark plan categories are as follows:

• The largest plan by enrollment in any of the three largest small group insurance products in the state’s small group market;
• Any of the largest three state employee health benefit plans by enrollment;
• Any of the largest three national federal employee health benefit plan options by enrollment; and
• The largest insured commercial non-Medicaid Health Maintenance Organization operating in the state.

Even states that choose not to operate an exchange (in which case there will be a federally operated exchange) can select a benchmark plan. However, should a state choose not to select any plan, the default plan will be the small group plan with the largest enrollment in the state.

If HHS proceeds with this approach, there are likely to be heated debates in each state about the appropriate benchmark plan. Moreover, it is not clear who in each state will make that decision. Will it be the exchange board in those states, such as Colorado, that are setting up their own exchange? Or, because the EHB applies to products sold both inside and outside the exchange, will it be the state Division of Insurance? Or will it be the state legislature? And what will be the role for state stakeholders in this process?

There will continue to be uncertainty about the benefits insurers are required to cover. And, contrary to the ACA’s intent, there will be no assurance that all Americans will have a minimum level of uniform and comprehensive coverage.

The bulletin only sets forth HHS’ proposed approach. There will be future rulemaking on the EHB, although HHS has not provided an indication of its timeline for issuance of the proposed rule. HHS is accepting comments on the bulletin until January 31, 2012; CCHI urges consumers to submit comments and make their concerns heard. Comments can be submitted to EssentialHealthBenefits@cms.hhs.gov.

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