What are ACA–Required Essential Health Benefits?
Starting January 1, 2014, individual and small group market health insurance plans must start covering a set of health care services categories known as essential health benefits. Essential health benefits, also known as EHB, must be equal in scope to benefits offered by a “typical employer plan,” according to The Center for Consumer Information & Insurance Oversight.
Under this Affordable Care Act provision, plans that fall both within and outside of Affordable Insurance Exchanges must include coverage for at least the following 10 categories:
- Ambulatory patient services
- Emergency services
- Maternity and newborn care
- Mental health and substance use 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
As of now, the Department of Health and Human Services reports that individuals and families who purchase their own health insurance do not currently have coverage for several of the EHB categories. The data on currently marketed plans submitted by health insurance companies to HealthCare.gov shows the following:
- Maternity services – 62 percent of enrollees do not have coverage
- Substance abuse services – 34 percent of enrollees do not have coverage
- Mental health services – 18 percent of enrollees do not have coverage
- Prescription drugs – 9 percent of enrollees do not have coverage
When Americans gain access to EHB in 2014, it is estimated that 8.7 million will gain maternity coverage, 4.8 million will gain substance abuse coverage, 2.3 million will gain mental health coverage, and 1.3 million will gain prescription drug coverage.
Additionally, plans and policies that began on or after September 23, 2010, cannot impose a lifetime limit for EHB services. HealthCare.gov states, “All plans, except grandfathered individual health insurance policies, must phase out annual dollar spending limits for these services by 2014.”
EHB benchmark plans
Every state will be required to select a benchmark plan from existing health insurance plans offered within their market. The health insurance plan selected will serve as a model, and all plans required to cover EHB must offer similar benefits to those in the benchmark plan. The small group health plan with the largest enrollment would be selected by default in those states failing to select a benchmark plan on their own. Benchmark plans that do not include all 10 EHB categories will be subject to supplementation under the proposed rule. Additionally, as listed on HealthCare.gov, a proposed rule on benchmark plans:
- Prohibits benefit designs that could discriminate against potential or current enrollees
- Includes special standards and options for health plans for benefits not typically covered by individual and small group policies today, including habilitative services
- Includes standards for prescription drug coverage to ensure that individuals have access to needed prescription medications
The Kaiser Family Foundation reports that the EHB benchmark only defines what benefits must be covered, not what cost-sharing levels will be. Carriers will develop cost-sharing for their own products based on actuarial value levels given by the Affordable Care Act.
The Center for Consumer Information and Insurance Oversight offers additional information on benchmark plans and essential health benefits.