The EHB bulletin, in December of 2011, established the approach that the Department of Health and Human Services intends to take in defining Essential Health Benefits. Their bulletin covered large fully-insured group health plans as well as large and small self-funded group health plans.
Their definition was particularly important to employers with self-funded plans, confirming that regardless of size, self-funded group health plans are not required to offer Essential Health Benefits. The bulletin was not very clear, however, in applying the restrictions on annual and lifetime dollar limits. Since self-funded plans are not subject to state law because of ERISA preemption, it is not clear how EHB will be determined by individual states. We are hopeful that the regulatory agencies will address these concerns more specifically and we will keep you posted as future communications are released.
HHS Issues Exchange Rules for States
On the health care reform law front, this past month saw the release of broad new operating rules for state-run health insurance exchanges. The long-awaited regulations, released by the Department of Health and Human Services, are intended to incorporate the flexibility that state lawmakers will need to establish state and regional insurance exchanges before the January 1, 2014 deadline.
State exchanges are one part of the Patient Protection and Affordable Care Act intended to provide health coverage for Americans who are currently uninsured. While 33 states have received federal grants to help set up exchanges thus far, many have delayed actions because of the high profile Supreme Court case, where oral arguments are scheduled to begin later this month.
While the new rules uphold the January 1, 2013 deadline for state exchanges to meet federal standards, they also allow states to qualify as long as they are able to offer open enrollment by October 1, 2013. States that fail to meet the deadlines will be served by exchanges established by the federal government.
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In cooperation with NAEBA