As the Institute of Medicine (IOM) unveiled its report on Essential Health Benefits (EHB) on Friday, there were few surprises. The panel delivered a high level outline for selecting benefits with a strong recommendation that cost consciousness be its guiding principle.
The IOM panel was tasked with outlining what criteria should be used to determine a minimum set of benefits for new health plans in the individual and small group market starting in 2014; these benefits serve as the benchmark for new Medicaid plans. The 300-plus page report recommends a framework for Health and Human Services (HHS) to use as they build the EHB package. The headline from this report is: cost before benefits.
This is a disappointment for advocates. Shifting the focus from robustness to predefined cost parameters could leave many Americans underinsured. In recognition of the difficult task presented to the panel, cost is an important factor in determining health benefits. As correctly noted in the report, “the more expansive the benefit package was, the more it was likely to cost and the less affordable it would be. How to balance the competing goals of comprehensiveness of coverage and affordability was “key.” However, making cost the guiding decision point rather than a factor of many alters the conversation from what is a good package for consumers to how much does that benefit cost?
Affordability doesn’t just mean lowest cost. Rather, getting people what they need at a price that they can afford is paramount. Too much emphasis on costs risks achieving the lowest premium possible without regard to the health needs of consumers.
The report guides HHS through five areas: 1) defining the EHB and developing a target premium; 2) public deliberation; 3) monitoring the EHB; 4) allowance for state variation; and 5) updating the EHB.
Consumer advocates will play an important role in each of these areas – particularly in defining priorities through public input. The IOM recommends that HHS hold public hearings or small group discussions throughout the country in order to aid in priority development. This is an opportunity for consumer advocates to voice their concerns and offer recommendations to HHS about services to include in the EHB package.
The panel also recommends that the package be released for comment to HHS by late spring 2012. For consumer advocates, this means a short time frame of influence.
A second priority for consumer advocates that is next in the development of the EHB package is how states will respond to it. By encouraging state-tailored options, the IOM suggests that there can be some state variation in the package. This may alleviate some stress regarding the many state mandates that exist in states – ranging from 13 in Idaho and 69 in Rhode Island – yet raises other concerns about exclusion of benefits.
Many challenges lie ahead for consumer advocates, including coordinating state- based consumer health care coalitions to respond to EHB. These coalitions can play a pivotal role in protecting consumers: a voice at public forums, a watch dog of EHB implementation from 2014 and beyond, and a feedback loop for HHS. The EHB will continue to change over time and advocates can play a key role in influencing EHB development.
IOM suggested timeline:
May 2012: HHS has developed an EHB package with a national premium target based on typical small and individual market plans
January 2013: HHS should develop a framework for data collection and analysis for purposes of monitoring implementation and updating the EHB package.
January 2016: The Secretary should update the EHB to make it increasingly more specific, and update annually.
-Eva Marie Stahl, Policy Analyst