States to weigh in on basic health coverage

Fri Dec 16, 2011 2:42pm EST

A patient waits in the hallway for a room to open up in the emergency room at a hospital in Houston, Texas, July 27, 2009.   REUTERS/Jessica Rinaldi

A patient waits in the hallway for a room to open up in the emergency room at a hospital in Houston, Texas, July 27, 2009.

Credit: Reuters/Jessica Rinaldi

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(Reuters) - U.S. health officials will allow states to select the basic set of medical benefits that must be offered by insurance plans participating in new exchanges mandated by the federal healthcare overhaul, the U.S. government said on Friday.

The Department of Health and Human Services announcement relates to the so-called essential health benefits for millions of Americans expected to qualify for coverage sold through state-based insurance exchanges beginning in 2014.

The proposed approach reflects the federal government's commitment to give states flexibility as they set up the exchanges, HHS Secretary Kathleen Sebelius said on Friday.

"The coverage that works in Florida may not work in Nebraska," Sebelius told reporters on a conference call.

Under the approach announced on Friday, states can select an existing health plan to set the benchmark for services included in the essential health benefits package.

As benchmarks, states would be able to choose either: One of the three largest small employer plans in the state; one of the three largest state employee health plans; one of the three largest federal employee health plan options; or the largest health maintenance organization plan offered in the state's commercial market.

As set out in the law, states must ensure the essential benefits package covers services in at least ten categories of care, among them preventive care, emergency services, maternity care and prescription drugs.

Ron Pollack, executive director of healthcare advocacy group Families USA, said that HHS needed to provide "strong oversight and enforcement" of the benefit standards as they are implemented in the states.

"It will be important to ensure that adequate coverage across all ten required benefit categories is provided - marking an improvement over many plans offered today," Pollack said.

HHS said it would take comments on the proposal until January 31. The announcement on Friday addressed only the services and items covered by a health plan, not cost sharing, such as deductibles, co-payments, and co-insurance. HHS plans to address cost in a future announcement.

The essential benefits are perhaps the most anticipated piece of information still awaited by states, employers, health providers and especially insurers under President Barack Obama's landmark healthcare overhaul.

The exchanges are designed to create easy access to an open marketplace of insurance plans and to allow uninsured people and small businesses to band together to negotiate cheaper rates for healthcare coverage, as well as automatically be considered for government subsidies.

HHS has been subject to intense lobbying over the rule as virtually the entire U.S. healthcare system, including insurers such as Aetna Inc and WellPoint Inc, could be affected by it.

The Institute of Medicine, an advisory group to U.S. policymakers, recommended in October that essential benefits stay in line with the cost of insurance in a typical small employer plan, in step with inflation and medical advances.

The healthcare overhaul is designed to extend coverage to an estimated 32 million Americans who are now uninsured.

(Reporting by Lewis Krauskopf; Additional reporting by Anna Yukhananov in Washington; Editing by Lisa Von Ahn, Gunna Dickson, Gary Hill)

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Comments (8)
Eric93 wrote:
The Obama-care ‘Plan’ is a bunch of cacadootie. Why make it all so complicated. All they had to do was extend Medicare to everyone thus broadening the pool to make it actuarily sound and then require cash co-pays (of say $20/visit to cut down on frivolous visits) and annual and lifetime ‘caps’ (of say $50K and $500K). This would have given everyone basic coverage and those who wanted more could then have purchased supplemental insurance like is currently the case with legacy Medicare. Instead they had to write over 2000 pages of BS and create ‘choices’ (ie headaches) for all. Of course, doing it the easy way wouldn’t fly since the ‘paymasters’ of our so-called ‘representatives wouldn’t be happy. And now these ‘geniuses’ have a new ‘p;an’ to ‘solve’ the current Medicare crisis. Yeah sure!

Dec 16, 2011 2:51pm EST  --  Report as abuse
oldschool wrote:
We could eliminate this needless complexity and save millions by adopting single-payer universal coverage, thus joining the rest of the civilized world.

Dec 16, 2011 3:12pm EST  --  Report as abuse
USAPragmatist wrote:
@Eric93, Part of my agrees, but since the GOP would never go fora single-payer or public-option, only true solutions, Obama and the dems decided to try and propose a plan the GOP had originally promoted as their solution to healthcare costs.

Dec 16, 2011 3:45pm EST  --  Report as abuse
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