Primer on Essential Health Benefits
San Antonio—Beginning in 2014, as mandated by the Patient Protection and Affordable Care Act (ACA), insurance companies are required to include 10 categories of services known as essential health benefits for all health plans. See Table. The benefits for the plans must at least be equal to those of a typical plan offered by an employer. At the AMCP meeting, speakers provided an outline of the regulation during a session titled Defining Essential Health Benefits.
Debora Schering Sternaman, PharmD, director of formulary services at Catamaran, said that the ACA has led to several changes in the healthcare industry. For instance, children are now able to stay on their parents’ insurance plans until they are 26 years of age, insurance companies cannot exclude people based on preexisting conditions, insurers are required to spend at least 80% of the premiums they collect on medical care, all plans must cover preventative services, and many states have expanded their Medicaid program.
The ACA allowed states and the District of Columbia to choose 1 of the following plans to use as a benchmark for the essential health benefits: (1) the 3 largest small group plans; (2) the 3 largest state employee plans, the 3 largest national Federal Employee Health Benefits Program plans; and (3) the largest commercial health maintenance organization (HMO) with non-Medicaid enrollment. As of the January 2013 deadline, 45 selected small group plans as the benchmark, while 4 chose commercial HMOs and 2 chose the state employee plan. Of the benchmark plans, 35 states chose Blue Cross Blue Shield plans, 4 chose UnitedHealthcare plans, and 2 chose Kaiser Permanente plans. Dr. Sternaman noted the essential health benefits that plans are required to include. (See Table below)
In addition, companies with more than 49 full-time employees must offer a plan at or above 60% actuarial equivalence or pay a penalty of $3000 for each employee who purchases coverage through a public exchange or receives a premium credit or subsidy.
Before the ACA passed, only 2% of plans covered all of the essential health benefits, although most covered 7 or 8 of the categories, according to Joel Owerbach, PharmD, vice president of health policy and strategy at Alliance Life Sciences Consulting Group. He added that 97% of employer-sponsored plans and 49% of individual plans reached the 60% actuarial equivalence threshold.
In states that expanded Medicaid, people who have incomes up to 133% of the federal poverty level (FPL) are able to receive tax credits. For people who are buying coverage through the exchanges, they can receive tax credits if they make up to 400% of the FPL. The FPL is $11,940 for an individual and $23,550 for a family of 4 people.
In February, the government finalized the prescription drug benefits rules. Dr. Owerbach said that plans sold on the health insurance exchanges must provide the greater of 1 drug in every United States Pharmacopeia category and class or the same number of prescription drugs in each category and class as the essential health benefits benchmark plan. The plan must also submit its drug list to the exchange operators, the state, or the Office of Personnel Management.
In addition, the exchanges cannot have any protected drug classes, plans can implement drug tiers and other utilization management techniques, and plans must allow enrollees to request clinically appropriate drugs that the plan does not cover.
