The Exchange Board met today for the second time this month, this time with a specific focus on the Essential Health Benefits. The Essential Health Benefits (EHB) are the minimum floor for what health insurance plans must cover, this is a key provision of the Affordable Care Act, which is intended to protect consumers from underinsurance and junk insurance. The federal government recently released a bulletin detailing an intended regulatory approach by which states are to select a reference plan, a plan that represents the scope of services and limits that all plans will be required to cover. The bulletin did not discuss cost-sharing and did not, at this time, lay out a specific EHB package.
The Board heard presentations from consultants and staff that provided background on the issue. The Exchange will be sending comments (in conjunction with the Department of Health Care Services, the Department of Insurance, the Department of Managed Health Care, and the Managed Risk Medical Insurance Board) to the federal government in response to the bulletin next week. You can see the draft comments here. The Exchange Staff summarized their comments into five overarching themes:
- It is important to move toward a national standard.
- It is appropriate to start by using each state’s employer-based benchmarks.
- Appreciate the state flexibility during the 2 year transitional period.
- The Exchange is concerned that carrier flexibility could undermine ACA’s goal of letting consumers better compare plans and makes it difficult for regulators as well.
- The Exchange agrees with need for a separate guidance for Medi-Cal.
When the Board invited public comment on the Exchange’s comments, the line extended all the way to the auditorium’s back doors.
Key issues that were raised by consumer advocates include:
- Need for clearer language around the issue of adverse selection and protections to prevent it.
- Strong concern with the detrimental consequences of carrier flexibility.
- Need for a eventual strong national standard that does not diminish
’s current standards, and a clear process to achieve this in 2 years. California
Moving forward, the Exchange will be incorporating some of the stakeholder comments into their comments, which will be submitted to the federal government next week. Additionally, they will be asking for clarification on a number of issues that were not explained in detail in the bulletin, for example, when formal regulations will be released. Then, the board will move forward on selecting the appropriate benchmark plans to serve as the state’s Essential Health Benefits.
Peter Lee also provided an update on the CalHEERS solicitation. The second part of the solicitation was released today, which included model contracts, cost schedules, and updated program metrics.
The next meeting of the Exchange Board will be February 21, 2012.