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  • HHS Unveils Proposal Allowing States to Change Details of Essential Health Benefits

    The US Department of Health and Human Services (HHS) wants to change the ways the Affordable Care Act's (ACA) state insurance exchanges set up their coverage requirements. It's a detailed, complicated proposal, but wade in far enough and you'll get to the real story: a push toward a system that would allow states to dramatically alter the way they manage so-called "essential health benefits" (EHB) that include rehabilitation.

    The result? "Mass confusion and market disruption," according to APTA Director of Regulatory Affairs Kara Gainer, JD. "These changes, if adopted, would also impose a significant financial and administrative burden on consumers and providers, given they may face dramatic changes to their coverage on an annual basis." APTA is preparing comments to HHS on the proposal and will develop template letters for use by members in the coming days. Comments on the rule are due by November 27.

    At the heart of the proposal is a plan that would allow states to play mix-and-match with other states' provisions associated with EHB "benchmark" plans; essentially, the minimum health insurance requirements for policies offered through a particular state's insurance exchange. Although every state must require that insurance policies include coverage for 10 EHBs, just how that coverage is managed—elements such as number of allowed visits for physical therapy, or limits to the kinds of services that are included in an EHB category—can vary.

    Even though some variations in coverage are allowed under the current system, those variations must exist within certain parameters. States currently are restricted to adopting a plan that echoes 1 of several options: the 3 largest group plans in the state, the 3 largest state employee health plans, the 3 largest federal employee health plans, or the largest HMO offered in the state's market. States that opt not to adopt a benchmark plan are assigned a plan that mimics the largest small group plan in the state. Benchmark plans were stable from 2014 through 2016; some may have changed slightly in 2017.

    The proposed rule would change all that. States would be allowed to adopt entire plans or parts of plans from other states, or they could develop their own plan, so long as the new plan isn't more generous than it was before. In addition, the HHS proposal would significantly lower the bar when it comes to the extent of coverage: instead of adopting plans from the list of large plans, the state would be required only to offer a plan that is slightly better than the skimpiest allowable employer-sponsored or self-insured group health insurance plan. Plans could be rejiggered every year.

    This isn't good news for consumers, Gainer says.

    "While it's true that the 10 EHB categories aren't going away, allowing states such broad flexibility in setting their individual EHB benchmark plans could result in consumers losing coverage to a lot of services that fall under the EHB categories," Gainer said. "There is great potential for not only confusion among consumers but disruptions in access to care."

    Here's how it might work. Currently, some states—California, for example—have relatively broad EHB benchmark requirements for rehabilitation benefits, while other states, such as Arizona, have benchmarks that include visit limits for physical therapy and occupational therapy. Under the plan, California could choose to adopt all of Arizona’s EHB benchmark plan or just replace its rehabilitation category with Arizona's rehabilitation category of benefits, leaving consumers in California suddenly facing visit limits and other restrictions.

    Making matters even worse, according to Gainer, is the provision that a state's EHB-benchmark requirements need only be better than the most minimal allowable employer plan or self-insured group health plan, and not exceed the generosity of the state’s 2017 benchmark plan. Using Arizona as an example, if the state chose to build its own EHB-benchmark plan and define the benefits within each category, it could lower the amount of coverage offered, but it would be prohibited from developing a benchmark plan that is more generous than it is today.

    "Some employer and self-insured group health plans can be very restrictive and severely limit actual benefits under each EHB category," Gainer said. "If a state chooses to design its own EHB-benchmark plan, the new plan just has to be slightly better than that."

    APTA has been focused on preserving EHBs throughout 2017, as Congress made repeated attempts to repeal and replace the ACA with plans that would have greatly reduced or eliminated the concept. APTA President Sharon L. Dunn, PT, PhD, issued a statement describing the removal of EHBs as an action that would run counter to APTA principles on health care.

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