With the passage of Obamacare (PPACA), our federal government defined a list of minimum health care benefits that Americans should have for public well-being. They have called this list of 10 broad categories the Essential Health Benefits (EHBs).
Below is a brief summary of the Essential Health Benefit categories.
|(1) Ambulatory patient services||Medical care that does not require 24/7 medical staffing provided in a hospital setting.|
|(2) Emergency services||Care received in an Emergency Room|
|(3) Hospitalization||Medical care that requires 24/7medical staffing provided in a hospital setting|
|(4) Maternity and newborn care||All medical services provided before and after a child is born even if the pregnancy started before insurance took affect|
|(5) Mental health and substance use disorder services including behavioral health treatment||All counseling as well as behavioral health treatment for alcohol abuse and drug abuse|
|(6) Prescription drugs||Prescription medication but not over-the-counter drugs|
|(7) Rehabilitative and habilitative services and devices||Rehabilitation covers services such as relearning to speak after an aneurysm while habilitative services involve learning a new skill such as managing diabetes through various behaviors|
|(8) Laboratory services||Blood tests, xrays, etc.|
|(9) Preventive and wellness services and chronic disease management||Services like colo-rectal cancer screening, immunization vaccines, breast cancer mammography, obesity screening. Full list is given online. https://www.healthcare.gov/coverage/preventive-care-benefits/|
|(10) Pediatric services, including oral and vision care||For children 18 or younger, services for dental care and corrective eyewear ( including eye exams)|
Who is Ensured Essential Health Benefit Coverage?
Obamacare (PPACA) “ensures” “access to quality, affordable health insurance” with Essential Health Benefits (EHB) to those who get their insurance in the non-group and small group markets. Beginning in 2016, Obamacare (PPACA) enlarged the small group market category to include employers with up to 100 employees (from employers with up to 50 employees). These eligible Americans can buy coverage on the Health Insurance Marketplace or from various businesses (insurance companies or their brokers, multi-company insurance aggregators) choosing to do business outside the Marketplace.
It is assumed that Americans employed by larger employers (more than 100 employees) can rely on the largess of their employers for quality, affordable health insurance with EHB-like coverage. Americans who receive their health insurance through government-sponsored programs are also assumed to not need Essential Health Benefits safeguards. Therefore, only a small fraction of the U.S. population (less than 10% of the population in 2014 ) can be assured that their health insurance plans contain core Essential Health.Benefits.
Why Do Some Americans Need Essential Health Benefits?
Before Obamacare (PPACA), individuals who had to buy their health insurance on the non-group and small business markets were forced to purchase low value health insurance plans with major gaps in coverage. Affordable health insurance with essential benefits were largely non-existent for people who fell into these groups.
Obamacare (PPACA) had the option of absorbing these individuals into an existing program (perhaps the nationwide FEHB program for federal employees) or creating a standardized benefit, minimum value alternative. As we all know by now, the government chose to create two new marketplaces for these groups: the Health Insurance Marketplace (for non-group Americans) and the Small Business Health Options Program (SHOP) (for small groups), where eligible Americans can shop for health insurance plans that cover a core Essential Health Benefit package.
Who Defines the Insurance Benefit Details?
Our government intentionally made the EHB categories broad and left the definition of specific health benefits (e.g., one cancer treatment and not another) in the hands of 50 separate states (plus the District of Columbia) and the insurance companies that sell the specific insurance plans within their borders. Instead of one specific EHB definition for all Americans, we now have 51+ definitions. I will discuss the differences in state to state coverage in a subsequent post.
The specific health benefits for groups not covered by Essential Health Benefits are defined by the groups that sponsor them. For example, individual employers provide specific benefits for their employees at their own discretion. Government program health benefits vary from program to program. For example, Medicare benefits are largely spelled out in program manuals, National Coverage Determinations developed by the Centers for Medicare & Medicaid Services (CMS), and in local medical review developed by contractors to CMS.
I have summarized the information above for easy reference.
|Insurance Groups||Must Cover EHB?||Who Defines Insurance Benefits for These Americans?|
|Government-Sponsored Programs||No||Federal Government|
|Individual and Small Group Plans||Yes (except if grandfathered)||Individual States|
|Employer-Sponsored, Fully Insured Large Group Plans||No||Individual States|
|Employer-Sponsored, Self-Insured Plans of Any Size||No||Individual Employer|
|Employer-Sponsored, Grandfathered Plans||No||Individual Employer|
What is Missing From the EHB List?
Because of cost minimization demands imposed on the final makeup of the Essential Health Benefits, these “essential” health benefits are incomplete for the overall functioning of the public good . With many competing special interests wanting their health benefits included on the list, you can just imagine how daunting the task of creating any EHB list can be.
I personally feel there are some glaring omissions in the Essential Health Benefits list; namely, adult dental, vision care, and hearing aid benefits. A person who cannot hear, eat properly (because of poor or absent teeth), or see properly will likely develop more costly medical needs as a result and suffer a reduced quality of life. A person with a good set of healthy teeth is more likely to land a job than one with obvious rotten teeth/gum disease. The ability to hear a fire alarm go off or a car horn blaring is a basic safety need. How much can including an adult eyeglass benefit be when a design company can make a $5 pair of stylish, quality glasses for Mexican schoolchildren? I guess it is easier to deny the benefit than step on some special-interest toes who presently charge hundreds of dollars for eyeglasses.
The Bottom Line
Essential Health Benefits (EHBs) can be summarized as follows:
- They are a list of 10 broadly-outlined areas for minimum health care benefits that all health insurance plans sold to the non-group (individual) and small group marketplaces are required to include.
- Specific details of the Essential Health Benefits (EHB) are left in the hands of 50 separate states (plus the District of Columbia) and the insurance companies that create the insurance plans sold. Instead of one specific definition for Essential Health Benefits we have 51+.
- Self-insured small group, all large group, grandfathered, and government-sponsored plans are not required to offer EHBs as part of their core coverage.
- Because of cost minimization demands when creating the EHB list, these “essential health benefits” are not necessarily optimized