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Wednesday, December 26, 2012

How Americans Will Be Offered Consistent Affordable Health Care Options

Much information has been published regarding the implementation of the Affordable Care Act designed to provide affordable health care insurance options for all Americans in 2014. To ensure that insurance standards are met and premiums consistently applied, the government's Department of Health and Human Services (HHS) on November 20, 2012, issued rules for states for follow in implementing the Affordable Care Act.

The rules will protect the consistency of standards for what is referred to as "essential health benefits" (EHB). This will provide not only quality health care coverage but also a consistent way for individuals to compare health plans. For both individual and small group health plans, the Affordable Care Act (ACA) rule specifically requires policies to offer essential health benefits in at least ten categories that include ambulatory patient services, emergency services, hospitalization, maternity and newborn care, treatment of mental health and substance abuse, prescription drugs, rehabilitation services and devices, laboratory services, preventive and wellness services and chronic disease management, and pediatric services (including oral and vision care).

The Department of Health and Human Services will also provide each state with a list of benchmark plans, ensuring state standards meet or exceed the standards outlined by the benchmark plans. For example, in the state of North Carolina, the benchmark plans provided by HHS include Blue Cross Blue Shield of North Carolina’s Blue Options PPO, and Federal Employees Dental and Vision Program (FEDVIP) as the benchmark for pediatric oral and pediatric vision. This means that the state's plan options must be consistent in quality and coverage with the benchmark, or standard proposed plans, recommended by HHS and include all ten categories in order to qualify as essential health benefits.

Affordable health care insurance plan costs will be consistently applied by the use of actuarial values (AV). Actuarial values are a measure of how much of the health care costs the plan will cover. States, for example, will be required to offer various levels of insurance plans, ranging from the bronze health plan that covers 60 percent of the cost up to the platinum level which covers 90 percent of health care costs. Consistently applied, individuals purchasing a bronze health plan will be responsible for the remaining 40 percent of health costs in the form of deductibles, co-payments, and coinsurance.  Whether insurance coverage is purchased from the state exchange or outside the exchange, plans must comply with ACA's rule regarding actuarial values. This will allow consumers to easily compare plans based on cost-sharing features.
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