HHS Issues Essential Health Benefits Bulletin on Benchmarking
Gives States Greater Flexibility in Determining What’s Covered Under New Exchange Plans in 2014
On December 16, 2011, the Department of Health and Human Services (HHS) issued a bulletin outlining proposed policies and the approach it intends to pursue in rulemaking for defining Essential Health Benefits (EHB). Per the Patient Protection and Affordable Care Act (PPACA), beginning on January 1, 2014, non-grandfathered Individual and Small Group plans offered inside and outside the Exchanges must cover the EHB. In addition, PPACA prohibits the use of lifetime and annual limits on the dollar amount of EHB.
In developing the regulation, HHS stated that its aim is to balance comprehensiveness, affordability, and State flexibility. It is, therefore, proposing to allow each State to select an existing health plan as a “benchmark” to establish the services and items included in the Essential Health Benefits package for 2014 and 2015.
States will choose from one of four health insurance plan options as a benchmark:
the largest plan based on enrollment in any of the three largest small-group products in the State
any one of the three largest state employee health plans
any one of the three largest Federal employee health plan options
the largest HMO plan offered in the State’s commercial market
HHS will propose that the default for States choosing not to set a benchmark will be the small group plan with the largest enrollment in the State. For 2016 and beyond, HHS would reassess the proposed benchmark process.
The bulletin did not address cost-sharing, e.g., deductibles, copayments, and coinsurance, which will be covered in future guidance. Cost-sharing rules will determine the actuarial value of the plan. It also does not address how this state-by-state approach is to be applied to the ban on lifetime and annual limits for plans that cover people in multiple States.
However, the bulletin did reaffirm that Essential Health Benefits must include items and services within the following 10 benefit categories:
(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.
Resources
HHS encourages public input on this proposal. Comments are due by January 31, 2012, and can be sent to: EssentialHealthBenefits@cms.hhs.gov.
For additional information, please visit:
- The Centers for Medicare and Medicaid site at cms.gov to read the Essential Health Benefits bulletin
- The HHS consumer site at healthcare.gov to read the fact sheet on the Essential Health Benefits bulletin
- The Assistant Secretary for Planning and Evaluation site on HHS at aspe.hhs.gov for a summary of individual market coverage as it relates to Essential Health Benefits
- Our Essential Health Benefits page on InformedOnReform.com
- The Assistant Secretary for Planning and Evaluation site on HHS aspe.hhs.gov for information comparing benefits in small-group products and State and Federal employee plans
This document is for general informational purposes only. While we have attempted to provide current, accurate and clearly expressed information, this information is provided “as is” and CIGNA makes no representations or warranties regarding its accuracy or completeness. The information provided should not be construed as legal or tax advice or as a recommendation of any kind. External users should seek professional advice from their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.
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Jesse Smedley is the Principal Broker for iHealthBrokers and the founder, president, and CEO of Smedley Insurance Group, Inc. and iHealthBrokers.com. Since the inception of SIG in 2007, Jesse has been dedicated to helping people save money on their health insurance by providing them with resources to educate themselves on all their health insurance options, both under age 65 and Medicare beneficiaries. He is featured in many publications as well as writes regularly for expert columns regarding health insurance and Medicare.