If insurers are permitted to drop coverage for the essential health benefits that they are required to cover under the Affordable Care Act—as legislation pending in Congress would allow them to do—they probably would do so, according to a Kaiser Family Foundation report released Wednesday.
The ACA required non-group and small group plans to cover 10 categories of essential benefits, and in most cases insurers had to cover the benefits at a scope comparable to that provided in employer-sponsored plans.
According to the KFF brief, the requirement to cover these services, including mental health and maternity care, is one factor increasing the cost of non-group coverage under the ACA.
In early May, the House approved the American Health Care Act (AHCA). Among other provisions, the bill would allow states to seek waivers to revise the essential benefits requirement if doing so would achieve certain objectives, including lower premiums.
The Senate is currently considering the measure.
KFF report details
For the report, the KFF researchers assessed plan data insurers submitted for display on HealthCare.gov for the fourth quarter of 2013—the last year before the ACA's major insurance market changes took effect. In total, the researchers looked at data from 8,343 plans across all 50 states and Washington, D.C.
According to the researchers, every plan studied covered "major benefit categories," such as ED care, inpatient physician/surgical services, and imaging, and nearly all of the plans (99 percent) covered outpatient physician/surgical services, primary care, home-health care services and inpatient/outpatient rehabilitation services.
However, other forms of benefits were not covered nearly as often, according to KFF. Specifically, the researchers found that:
- 75 percent of plans did not cover delivery and inpatient maternity care;
- 45 percent of plans did not cover inpatient or outpatient substance use disorder services; and
- 38 percent of plans did not cover inpatient or outpatient mental health care.
In regards to drug coverage, KFF found that:
- 17 percent of plans did not cover non-preferred brand drugs;
- 13 percent did not cover specialty drugs;
- 11 percent of plans did not cover preferred brand drugs; and
- 6 percent did not cover generic drugs.
The researchers also found that some plans imposed coverage restrictions on certain services. For instance, 23 percent of plans that covered mental health care capped the number of annual visits at fewer than 30, and 12 percent capped the number of visits at 12 or fewer. Moreover, 5 percent of plans that covered mental health care did so only for biologically based illness or severe mental disorders.
The researchers found similar restrictions for outpatient substance use disorder coverage. Twenty-two percent of plans that covered outpatient substance use disorder services capped annual visits at 30 or fewer, while 12 percent capped the number at 12 or fewer.
The researchers also found benefits restrictions in plans that covered maternity services. For instance, 3 percent of plans that covered maternity services applied a separate deductible of at least $5,000, and 6 percent applied a separate waiting period of one year before benefits took effect.
According to the researchers, the types of benefits that were covered less commonly before the ACA "all have some element of predictability or persistency that make them more subject to adverse selection"—the phenomenon in which individuals with high-cost conditions enroll in the plans that cover those services while people without those conditions do not. As a result, without a mandate to cover those services across all polices, insurers "would be very reluctant to offer some," the researchers said.
The researchers noted that the AHCA as currently proposed would allow people with pre-existing conditions to choose any plan at the standard premium, and they would be able to shift between plans annually without penalty so long as they stayed continuously covered. As a result, according to the researchers, "insurers would be very reluctant to offer some of these services" in states with waivers because "people who need these benefits would disproportionately select policies covering them."
The researchers wrote, "The AHCA presents state policymakers with a dilemma: they can reduce the essential health benefits to allow less expensive insurance options for their residents, but doing so may eliminate access to certain benefits for people who want and need them" (Baker/Nather, "Vitals," Axios, 6/16; Claxton et al., Kaiser Family Foundation issue brief, 6/14).
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