The Department of Health and Human Services’ Center for Consumer Information and Insurance Oversight (CCIIO) has issued additional guidance (pdf) on the approach the agency plans to take in defining the essential health benefits (EHB) that non-grandfathered insured health plans in the individual and small group markets must cover under the Affordable Care Act. In December 2011, the agency issued an essential health benefits bulletin that described its proposed regulatory approach in determining which benefits will be deemed essential. Generally, as of January 1, 2014, non-grandfathered plans in the individual and small group market and those in the future insurance exchanges will be required to provide coverage of benefits or services that fall into 10 separate categories, including emergency services, prescription drugs, and maternity and newborn care.
The December bulletin explained that HHS will propose that EHB be defined by a benchmark plan selected by each state, which could be modified as needed so long as the value of coverage is not reduced. The bulletin proposed four separate plan types that could be used as a benchmark: 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 (FEHBP) options by enrollment; or the largest insured commercial non-Medicaid Health Maintenance Organization (HMO) operating in the state. If the state opts not to use one of these four plan types as its benchmark, HHS intends to propose that the default benchmark plan per state “be the largest small group market product in the state’s small group market.” HHS defines a “product” as a package of benefits an issuer offers that is reported to state regulators in an insurance filing.
