Monday, December 19, 2011

HHS will allow states to determine essential health benefits

HHS announced Friday that they will give states broad latitude to define the minimum benefits that many health insurance policies will be required to offer under the 2010 healthcare law. 

Under the Department’s intended approach, HHS says, 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 10 categories of care, including preventive care, emergency services, maternity care, hospital and physician services, and prescription drugs.

According to the New York Times, Friday's decision "would allow significant variations in benefits from state to state, much like the current differences in state Medicaid programs and the Children's Health Insurance Program."

For more information, please see the HHS News Release.

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