An IOM panel is recommending that a required benefits approach that caters to beer budgets rather than champagne tastes. (AP Photo/Pat Wellenbach)

A basic health insurance benefits package that people can afford to buy may work better for the population as a whole than a more comprehensive plan that is too expensive, a key advisory group said today.

U.S. Health and Human Services (HHS) Secretary Kathleen Sebelius asked the IOM, Washington, to develop a set of “policy foundations, criteria and methods” for defining and updating “essential health benefits” (EHB) – the package of benefits that Patient Protection and Affordable Care Act of 2010 (PPACA) will require non-grandfathered individual and small group plans to offer starting in 2014.

Forecasters believe the EHB package requirements could apply to coverage for as many as 68 million U.S. residents by 2016, IOM officials say.

The panel IOM EHB includes representatives who are working or have worked for health insurers such as WellPoint Inc., Indianapolis (NYSE:WLP), and Kaiser Permanente, Oakland, Calif., as well as the Employee Benefit Research Institute, Washington.

Dr. John Ball, the chair of the IOM EHB panel and a former executive vice president of the American Society of Clinical Pathology, said today during a press conference that panel took the responsibility to balance EHB costs and comprehensiveness seriously.

“If that EHB package benefits is too narrow, health insurance might be inadequate to provide access,” Ball said. “If it is too expansive, insurance might become too expensive.”

The panel emphasized that it was not asked to develop specific lists of benefits to be covered, and it did so.

But the approach the panel is recommending for analyzing EHB candidate benefits could spell trouble for high-cost, much-publicized benefits, such as benefits for applied behavioral analysis (ABA) for autism.

The panel is recommending that HHS develop EHB recommendations by looking at surveys and other data showing what small group plans typically cover today.

Survey figures included with the IOM panel report show, for example, that the percentage of small group plans that cover ABA analysis is relatively low, and that one large insurer does not cover that therapy unless it is mandated to do so.

John Santa, a panelist from Consumer Reports, Yonkers, N.Y., praised the report’s “grownup approach to benefits.”

“Consumers can deal with these tough issues,” Santa said. “The question is whether the rest of us can.”