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Life Health > Health Insurance

Essential Health Benefits: First Silver, Then Fire

By thinkadvisor

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An Institute of Medicine (IOM) panel has developed a middle-of-the-road framework for designing of an “essential health benefits” package – and now the hard part starts.

The committee at the IOM, Washington, prepared the report to help implement a provision that calls for the secretary of Health and Human Services (HHS) to develop an “essential health benefits” package that all major medical plans must offer, to keep plans from competing on price by skimping on important benefits. The package requirements are supposed to take effect Jan. 1, 2014.

Some had hoped that the IOM committee would identify specific benefits that ought to be included in a plan, but the IOM committee noted that it was asked only to develop a framework for evaluating candidate benefits, not a list of benefits, and it stuck to that assignment.

Committee members repeatedly emphasized the importance of cost when they presented the report at a press conference Washington.

Karen Ignagni, president of America’s Health Insurance Plans (AHIP), Washington, put out a statement calling the report “thoughtful” and noting the IOM panel’s emphasis on the need to strike a balance between comprehensiveness of coverage and affordability, and the IOM panel’s suggestion that the benefits package ought to be similar to what small employers now offer.

“The recommendation that the initial EHB package reflect the scope of benefits and design provided under a typical small employer plan is an important step toward maintaining affordability,” Ignagni said in the statement.

Ignagni also praised the panel’s discussion of the need for a focus on “medical effectiveness, safety and relative value.”

Paul Keckley, executive director of the Deloitte Center for Health Solutions, Washington, said he has not seen much strong opposition surface so far.

Many commenters have talked about the IOM panel’s emphasis on solid, no-frills benefits — but the panel talked about what, in Patient Protection and Affordable Care Act of 2010 (PPACA) terms might be called a mid-level “silver” plan rather than a bare-bones “bronze” plan, Keckley said in an interview.

If the panel had recommended a truly bare-bones, no-frills, bronze-level plan, even some employers and health insurers might have objected and made a point of saying they would be covering many benefits outside benefits package, Keckley said.

Members of the panel “have kind of set up the lanes for the bowling alley,” Keckley said. “Now we have to figure out how to play. The devil will be in the details. There’s a lot of money riding on this.”

One of the major challenges will be selling ordinary people on the idea that people other than their own personal physicians should be able to have a say on their care, Keckley said.

In countries with single-payer health insurance systems, medical care standard setters are common, but, in the United States, “everybody did their own thing,” Keckley said.

If the physicians and the standard setters do not find a way to come into alignment, Keckley said, “we’re going to have a clash.”

thinkadvisor

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