In a sign of what states should expect from the federal government’s implementation of ObamaCare, Nebraska’s proposed “Essential Health Benefits” (EHB) package has been rejected by the Department of Health and Human Services (HHS), the New York Times reported last week.
A state’s EHB package sets the standard for ObamaCare’s “minimum essential coverage” requirement, which forces health insurance providers in the individual and small group markets to offer coverage at a certain level with certain benefits as determined by HHS.
Initially, the administration intended to impose a uniform set of required benefits on all health insurance plans nationwide, but after criticism that its approach was too rigid, HHS announced that states could craft their own EHB packages-as long as they included “items and services” in ten different categories of coverage, and as long as the scope of services reflect what’s found in a “typical employer health plan.”
Nebraska’s plan, submitted in October, called for a health savings option with high deductibles-$4,000 for individuals and $8,000 for families. Nebraska Governor Dave Heineman considers high-deductible plans to be more affordable options for individuals and families not facing serious health challenges. But HHS disagreed, and rejected the plan.
If it wasn’t clear before, it should be obvious by now: the notion that the federal government is interested in giving states “more flexibility and freedom” in implementing ObamaCare, as HHS claimed in a bulletin last year, is a fiction. There is very little room for state flexibility in the rules and regulations HHS is churning out for the health care law, and whatever discretion states are granted in crafting their plans is merely cosmetic.
States that are pondering cooperation with the Feds should take note of the Nebraska example, particularly when it comes to setting up health insurance exchanges in hopes of tailoring them to their residents’ unique needs. The exchanges, like the EHB plans which will be sold on them, will be substantively uniform in their design and function, and offer what amounts to standardized health insurance plans.
For states that refuse to select an EHB package-so far, that’s nearly half the states-the default EHB package will be the largest plan available in each state’s small-group insurance market. States face a December 26 deadline to craft an EHB package that conforms to HHS’ stringent requirements.