Essential Health Benefits – Still an Elusive Concept

From the KT Health and Welfare Team:

The term, “essential health benefits,” is well, essential, to employers and insurers as we approach 2014.  For employers, lifetime and annual limits are prohibited for any benefit that is an “essential health benefit.”  Further, if an employer plan does not offer “minimum essential coverage” the employer will need to pay the shared responsibility penalty.  (It is rumored that HHS will link essential health benefits with the requirement to provide minimum essential coverage.)  For insurers, Exchanges and individuals, essential health benefits is a term that is even more important.  HHS has spent over a year talking about how the rule would look.  Today, HHS published additional fact sheets and guidance on how it intends to define essential health benefits.  However, no definition has yet emerged.

Under the approach announced today, states would have the flexibility to select an existing health plan to set the “benchmark” for the items and services included in the essential health benefits package. States would choose one of the following health insurance plans as a benchmark:

· One of the three largest small group plans in the state;

· One of the three largest state employee health plans;

· One of the three largest federal employee health plan options;

· The largest HMO plan offered in the state’s commercial market.

The benefits and services included in the health insurance plan selected by the state would be the essential health benefits package. Plans could modify coverage within a benefit category so long as they do not reduce the value of coverage. Consistent with the law, states must ensure the essential health benefits package covers items and services in at least ten categories of care.  If a state selects a plan that does not cover all ten categories of care, the state will have the option to examine other benchmark insurance plans, including the Federal Employee Health Benefits Plan, to determine the type of benefits that will be included in the essential health benefits package.  However, the impact on self-insured plans of the new state flexibility is unclear.  Hopefully, more guidance will follow.

For the essential health benefits bulletin, visit:http://cciio.cms.gov/resources/regulations/index.html#hie

For a fact sheet on the essential health benefits bulletin, visit:http://www.healthcare.gov/news/factsheets/2011/12/essential-health-benefits12162011a.html

Kilpatrick Townsend & Stockton LLP
Mark L. Stember 
Kilpatrick Townsend & Stockton LLP
Suite 900 | 607 14th Street, NW | Washington, DC  20005-2018
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About rjoyner

Ric Joyner, CEBS, GBA, CFCI Customer Experience Officer Ric is a founder of eflexgroup.com a national web based TPA for Cafeteria, HRA, HSA, Transit, VEBA and COBRA plans. eflexgroup is a leader in self-service employee benefit systems. eflexgroup was the first TPA in the industry to go “online” in 1999 allowing employees to self-serve 24 hours per day. He has lead the industry with eflex by placing provable customer service statistics, live, on eflexgroup.com Ric is celebrating his 32nd year employee benefits. He helped create TPAs such as TASC and Employee Benefits Corporation in Madison WI. He was a licensed insurance agent for 29 years. The designations Mr. Joyner holds are; Certified Employee Benefits Specialist, Group Benefit Associate, Certified Flexible Compensation Instructor, board approved by ASPA to teach Cafeteria Plan regulations. Ric also has a bachelors of science in Information Technology and MBA (emphasis is project management) and graduated summa cum laude from Capella University with a 4.0. Ric helped found the National Association of Professional Benefit Administrators (NAPBA.org). NAPBA is dedicated to training administrators in best practices and grass roots lobbying. Ric has served in the past as the Wisconsin Association of Health Underwriters State President in 2003. Ric is a frequent speaker and article writer for prestigious associations such as NAHU.org, NAPBA.org, Wisconsin SHRM, Austin SHRM, PACE.org, International Foundation of Employee Benefits, Tampa Bay AHU, WI AHU, Florida AHU, Florida NAIFA and participates on the List Serves (compliance programs for Consumer Driven Products of NAHU and International Foundation of Employee Benefits)

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