By John Reichard, CQ HealthBeat Editor
January 23, 2013 -- The growing concern among insurance analysts that coverage will be unaffordable in the new health care exchanges might create a fresh opportunity for federal officials to be persuaded to trim requirements in the final essential health benefits (EHB) rule, which is expected out in February or March.
Employers and insurers certainly hope so. With a few weeks to go before the final version is expected, they held a news briefing last week to highlight six recommendations for shaping the rule in a way that they say makes coverage less costly.
Change the Essential Health Benefits Coalition wants the final regulation to include:
- Scaling back requirements for pediatric dental and vision care benefits.
- Allowing the adoption of "medical management techniques" to ensure that the use of required benefits is consistent with evidence-based clinical practice guidelines.
- Backing off a requirement that plans cover one or more prescription drugs in each drug category.
- Limiting requirements for "habilitative services" that help people with medical conditions acquire new skills, such as helping a child with autism improve language skills or a person with cerebral palsy learn to walk (as distinct from rehabilitation services to recover lost skills).
- Reconsidering the inclusion of state-mandated benefits.
- Considering an employer's entire contribution to a health savings account when determining maximum deductibles.
The Department of Health and Human Services (HHS) unveiled a proposed rule on essential health benefits Nov. 26, 2012. In a recent letter to HHS Secretary Kathleen Sebelius, Republican Sam Graves of Missouri, chairman of the House Committee on Small Business, noted that some of the benchmark plans that states may pick to comply with the benefits rule might not cover all the essential benefits.
"Virtually all small businesses will be forced to supplement state-selected policies that will not include coverage for mental health, substance abuse, pediatric dental and vision, habilitative care and additional prescription drugs," Graves wrote. Many small-business owners will struggle to afford any health insurance coverage, let alone the supplemental coverage envisioned by the proposed rule, he said.
Neil Trautwein, vice president of the National Retail Federation, said at the briefing that insurers are struggling to put together affordable "bronze" plans to be sold in exchanges. Bronze is the least generous of the "metal" categories of coverage the health care overhaul (PL 111-148, PL 111-152) says must be offered.
Asked to mention one issue that must be addressed in the final rule to make coverage affordable, Trautwein said "it's hard to boil down a list of recommendations into a single issue, but we want the EHB [final rule] to be more like private coverage is today, not like Medicare coverage is in terms of the specificity of included benefits." And, he said, it should be easier to change benefits. The fact that private insurance plans can react more quickly to medical advances and don't specify coverage service by service "is a strength of private coverage, and we would hope that the EHB" would follow that model, he said.
Geraldine O'Shea, an official with the American Osteopathic Association, said a requirement that benefits must follow evidence-based clinical practice guidelines would be the best way to ensure affordability.
Asked about the tipping point for when benefit requirements would drive premiums up so high that employers will no longer provide coverage and pay penalties instead for not covering workers, Paul Fronstin of the Employee Benefits Research Institute said "it might not take any increase" in premiums for that to happen. There's already been a 10 percent drop recently in the proportion of employers who offer health coverage, he said.
Large numbers of employers may not drop coverage in 2014, but they could start to do so over the next decade. Trautwein added that "it's tough to absorb additional cost" in the retail trade. "We have very thin profit margins."
Pulling the Centers for Medicare and Medicaid Services (CMS) in the opposite direction are patients' advocacy groups, who say not covering certain medications or services could have devastating consequences. They've written CMS to urge coverage of new drugs and to ensure coverage of more than one medication per drug category. The groups include those representing patients with HIV/AIDS, hemophilia, kidney disease, mental illness, and a wide range of other conditions.
