Essential Health Benefits Advisory Committee Report

ESSENTIAL HEALTH BENEFITS ADVISORY COMMITTEE:

A SUMMARY OF STAKEHOLDER FEEDBACK AND

REPORT TO HEALTH CARE REFORM COORDINATING COUNCIL

August 29, 2012

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INTRODUCTION

The Patient Protection and Affordable Care Act (ACA) requires that, as of January 1, 2014, all small group

and individual health benefit plans sold inside and outside of health benefit exchanges (Exchange) must

cover a core set of “essential health benefits” (EHB) as defined by the U.S. Department of Health and

Human Services (HHS). Establishing a transitional approach for the years 2014-15, HHS has directed that

states will be permitted to select a “benchmark plan” from among ten eligible plans that will serve to

constitute the state’s EHB. A state’s benchmark plan must cover ten categories of benefits mandated by

the ACA, and states must select their plans by September 30, 2012.

The Maryland Health Benefit Exchange Act of 2012 directed the Health Care Reform Coordinating

Council (HCRCC) to select Maryland’s benchmark plan. In doing so, the HCRCC must balance

comprehensiveness of benefits with plan affordability, accommodate to the extent possible the wide-

ranging health needs of the state’s diverse population, and ensure the benefits of public input. The

selected plan must comply with the ACA, the Mental Health Parity and Addiction Equity Act (MHPAEA),

and all other relevant laws, regulations, and policies.

To ensure stakeholder and public engagement and input into its decision, the Act requires the HCRCC to

appoint and consult with an EHB Advisory Committee (Committee). The Committee was required to

comprise a diverse and representative cross-section of stakeholders and, to the extent practicable,

reflect the gender, racial, ethnic, and geographic diversity of the state. The Committee was charged

with reviewing a comparative analysis of the state’s benchmark options, providing input on the options,

facilitating written and oral comments from other stakeholders and the public, and submitting a report

summarizing the analysis and stakeholder input to the HCRCC for its consideration in making the

benchmark selection.

SUMMARY OF FEDERAL GUIDANCE

A. Patient Protection and Affordable Care Act Requirements

To achieve its goal of promoting access to quality, affordable health insurance for all Americans, the

ACA requires that in the individual and small group markets inside and outside of the Exchange, all

plans must cover a core, comprehensive package of EHB. These benefits must cover items and

services in each of the following 10 categories:

1. Ambulatory patient services

2. Emergency services

3. Hospitalization

4. Maternity and newborn care

5. Mental health and substance use disorder (MH/SU) services, including behavior health

treatment

6. Prescription drugs

7. Rehabilitative and habilitative services and devices

8. Laboratory services

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9. Preventative and wellness services and chronic disease management

10. Pediatric services, including oral and vision care

In defining EHB, the Secretary of HHS must also ensure that they: 1) reflect an appropriate balance

among these ten categories; 2) do not discriminate based on age, disability, or expected length of life;

3) take into account the health care needs of diverse segments of the population; and 4) do not allow

denials of essential benefits based on age, life expectancy, disability, or degree of medical dependency

and quality of life. Finally, while the EHB package must cover the ten minimum categories, states will

bear the cost of including benefits required by state law in excess of the EHB for individuals enrolled in

any plan offered through an exchange.

B. HHS Bulletin (December 16, 2011)

On December 16, 2011, HHS issued a bulletin outlining its intent to adopt a transitional approach to

defining EHB through which states will be allowed to establish their own EHB by selecting a benchmark

plan that reflects the scope of services offered by a “typical employer plan.” States would then choose

one from among the following eligible plans: 1) the three largest small group plans in the state by

enrollment; 2) the three largest state employee health plans by enrollment; 3) the three largest federal

employee health plan options by enrollment; and 4) the largest HMO plan offered in the state’s

commercial market by enrollment. A state that decides not to select a benchmark will default to its

largest small group plan.

The HHS bulletin further provided that states will be able to include state mandates within their EHB

without defraying the costs of those mandates for at least 2014 and 2015, if the benchmark plan

selected includes the mandates as of the first quarter of calendar year 2012. The benchmark plan must

also cover services and items in all ten categories mandated by the ACA (outlined in Section A, above). If

a state chooses a benchmark plan that does not cover all ten categories, it may select benefits from its

other eligible plans to cover any gaps.

In addition, the bulletin indicated that to meet coverage standards, health plans must offer benefits that

are “substantially equal” to a state’s selected benchmark plan and must be modified as necessary to

reflect the ten ACA categories. Health plans will also be able to modify coverage within a benefit

category, including both specific services and any quantitative limits, as long as they continue to provide

coverage in all ten ACA categories and do not reduce the value of the coverage. By permitting flexibility,

HHS seeks to promote greater consumer choice and plan innovation while ensuring that all plans offer a

certain level of benefits. Finally, the bulletin explained that this benchmark approach will be revisited in

2016.

C. HHS Final Rule on EHB Data Collection (July 20, 2012)

On July 20, 2012, HHS issued a final rule establishing the categories of data on potential state

benchmark plans, which must be collected from carriers to support the EHB benchmark selection

process. Specifically, the rule directed issuers of the three largest small group market products in each

state to report the following information to HHS by September 4, 2012:

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1. Administrative data necessary to identify eligible health plans for benchmark selection; and

2. Data and descriptive information for each plan on the following items:

a) All health benefits in the plan;

b) Quantitative treatment limitations;

c) Prescription drug coverage; and

d) Enrollment.

This final rule also contained a few important clarifications of HHS’ earlier proposed rule on EHB data

collection. Specifically, some data deemed "non-quantitative" or "non-therapeutic" which were part of

the draft regulation were eliminated from the requirements in the final rule. Thus, these non-

quantitative benefit design elements will not be part of the EHB. Second, the final rule clarifies that if

the chosen benchmark plan includes riders, those riders must be included as part of the EHB.

SCOPE OF MARYLAND’S ROLE AND OBLIGATION IN SELECTING THE BENCHMARK PLAN

A. Patient Protection and Affordable Care Act Requirements

As delegated to the HCRCC in the Maryland Health Benefit Exchange Act of 2012, the decision-making

process must balance comprehensiveness with plan affordability. Additionally, the HCRCC must take

into account stakeholder and public input in its decision. To facilitate stakeholder and public

engagement, the HCRCC established the Committee.

The Governor’s Office of Health Care Reform (GOHR) solicited nominations for membership to the

Committee between April 19 and May 1 of 2012. This call for nominations was posted on the GOHR

website and emailed to all members of the General Assembly as well as to approximately 2,000

stakeholders on the GOHR email distribution list. Over 75 nominations were received.

At its May 2012 meeting, the full HCRCC requested that a four-person working group of its members

undertake the responsibility of appointing the Committee members. To ensure the selection of a

diverse and representative cross-section of stakeholders, the workgroup chose representatives from

four stakeholder categories: 1) carriers (e.g. medical, dental, and vision); 2) providers (e.g. community,

hospital, and academic); 3) advocates (e.g. consumer/patient advocacy organizations and provider

associations); and 4) purchasers/users of health benefits (e.g. small employers and unions). It also

sought to balance racial, ethnic, gender, and geographic representation.

The Committee appointed by the HCRCC workgroup draws upon all four geographic regions, has 12 men

and 16 women, and reflects the racial and ethnic diversity of the state. Appendix A lists the members of

the Committee and their affiliations. The chart below shows the Committee’s membership by each of

the four stakeholder categories.

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The Committee has worked actively to fulfill its responsibility of reviewing a comparative analysis of the

state’s benchmark options, providing input on the options, facilitating written and oral comments from

the public and other constituents, and submitting this report summarizing the analysis and stakeholder

input to the HCRCC for its consideration in making the benchmark selection. It convened six public

meetings through the summer, provided input into the consultant’s analysis of the potential benchmark

plans, heard public testimony, and solicited written public comments during an open comment period.

During the public comment period, 45 letters were submitted by organizations providing pros and cons

of each of the benchmark plan options. The public comments are summarized in Appendix B.

B. Analysis of Maryland’s Potential Benchmark Plans

As part of a technical assistance grant from the Robert Wood Johnson Foundation and the State

Network, Wakely Consulting Group (Wakely) conducted a comparative analysis of Maryland’s ten

eligible benchmark plans to assist in the selection of the state’s benchmark. Wakely then worked with

the HCRCC, the Committee, and the GOHR, to refine and revise its analysis to reflect public input on

which benefits to examine in their comparisons. Their final analysis (Appendix C) compared the benefits

of the different benchmark options; quantified the premium impact of each benchmark option

(Appendix D); identified which state mandates are covered by each option (Appendix E); identified those

benefits that would need to be supplemented for each option to comply with the ACA; and provided an

analysis of the compared benefits in the pediatric dental and vision benchmark options (Appendices F

and G).

1. Benefit Comparison

Wakely’s analysis focused on the following ten plans eligible for selection as the state’s benchmark:

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5

EHB Advisory Committee Membership

Advocates

Carriers

Providers

Purchasers

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1. Small Group 1 – CareFirst BlueChoice HMO HSA Open Access

2. Small Group 2 – CareFirst BlueChoice HMO

3. Small Group 3 – CareFirst BluePreferred HSA PPO

4. State Plan 1 – CareFirst PPO

5. State Plan 2 – CareFirst POS

6. State Plan 3 – CareFirst EPO

7. HMO – CareFirst

8. FEHBP – BCBS Standard

9. FEHBP – BCBS Basic

10. FEHBP – GEHA Standard

In comparing the benefits of each benchmark option, Wakely’s analysis grouped 86 benefits into the ten

categories required by the ACA. It captured any quantity limits (e.g. limit of ten chiropractic visits per

year), as well as any other significant limits (e.g. chiropractic services covered only for spinal

manipulations). Per HHS guidance, non-quantitative limits are excluded from the comparison.

2. Premium Impact Estimates

Wakely’s analysis also estimated the premium impact of each benchmark plan option. For consistency,

benefits that would need to be supplemented for at least one plan are not included in the premium

impact analysis (e.g. benefit differences related to habilitative services, pediatric dental care, and

pediatric vision care). In analyzing benefit costs, Wakely examined industry data and the reporting of

the costs of state mandated benefits from Mercer’s Report of Market Rules and Risk Selection for the

State of Maryland (November 8, 2011). Where only limited data were available, the analysis makes an

actuarial judgment of cost.

In estimating premium impacts, Wakely’s work considered each benefit independent of downstream

effects. For example, if infertility treatments were covered, maternity costs might increase, including a

higher incidence of high cost multiple births. Only the estimated cost of the infertility benefit, however,

was included in the estimate. In addition, where necessary, dollar limits (e.g. $2000 per year for

alternative medicine limitation) were converted to visit/day/unit limits based on an estimated allowed

cost per visit/day/unit.

Additionally, Wakely’s premium estimates are for 2014 per member per month (PMPM) projections, and

they assume no member cost sharing. Therefore, the actual impact for a silver plan would be

approximately 70% of the impact shown for carriers. Further, federal subsidies would also increase in

proportion to the cost of the plan, offsetting much of the premium impact for individuals and families

eligible for federal subsidies. Thus, the projected premium impact represents an estimate of the

increase in total cost relative to a baseline or reference plan rather than an expected increase in out-of-

pocket costs to consumers.

For this analysis, the small group and HMO plans (the leanest benchmark options) served as the baseline

for premium impact projections, and estimates for all other plans are relative to this baseline. For

example, if Plan A’s premium impact is between $2.50 and $3.50, then that plan is $2.50-$3.50 more

expensive than the baseline plan due to its more robust coverage. Accordingly, the premium of the

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baseline plan would increase by this amount if Plan A were chosen as the benchmark. In sum, while

specific benefit differences among the benchmark options are important, the focus of the premium

impact analysis is on the relative comprehensiveness of the benchmark options.

3. State Mandated Benefits

Wakely’s analysis also included a list of all state health insurance coverage mandates and which

benchmark options cover each mandate. All of the benchmark options included most of the state

mandates; however, the state employee plans were the only options that covered all state mandates.

4. Analysis of Supplemental Benefits

Wakely’s analysis demonstrated that the benchmark option plans will need to be supplemented to meet

the ACA requirements regarding pediatric dental and vision benefits and habilitative services benefits.

However, to date, HHS has only provided guidance on how states must supplement pediatric dental and

vision benefits. With respect to pediatric vision benefits, the Federal Employee Dental and Vision

Insurance Program (FEDVIP) vision plan with the highest national enrollment (BlueVision High plan) is

the only supplemental option. In their analysis of the supplemental options, Wakely listed the benefits

in the FEDVIP plan and calculated a projected premium impact for adding these supplemental pediatric

vision benefits.

With respect to pediatric dental care, the two supplemental options are the FEDVIP dental plan with the

highest national enrollment (MetLife Dental PPO – High Option) or the Maryland State Children’s Health

Insurance Program (MCHP) plan (Healthy Smiles). Wakely compared the benefits for both options for

supplementing dental benefits and estimated premium impacts for each option.

5. General Findings and Conclusions of the Wakely Analysis

In general, the comparison of benchmark option plans suggests that the HMO and small group plans are

the leanest options with the state employee plans and the BCBS Standard federal employee plan

appearing slightly more robust. The BCBS Basic and GEHA federal employee plans are the most robust

options. The benefits that appear to drive the difference in premium impact include in vitro fertilization

(IVF) and adult dental benefits. Further, both supplementary pediatric dental options are

comprehensive and have very similar premium impacts. The findings and conclusion of the Wakely

analysis are discussed in greater detail in the discussion of pros and cons for the benchmark plan

options.

PROS AND CONS OF EHB BENCHMARK PLAN OPTIONS

A. Eligible HMO and Small Group Plans

In Maryland, small group plans are subject to the Comprehensive Standard Health Benefit Plan, which is

a uniform benefit package that carriers selling to the small group market are required to provide.

Additionally, all three of the small group EHB benchmark plan options and the largest HMO plan in

Maryland, which is also a small group plan, are offered by the same carrier — CareFirst. For both of

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these reasons, the packages of benefits offered in these four plans are identical for the purposes of the

EHB benchmark selection process.

In their analysis of the eligible HMO and small group plans, Wakely found that these plans were

generally leaner and, consequently, had a lower projected premium impact than the other benchmark

plan options. In particular, Wakely found the following key differences in coverage for these plans

relative to the other benchmark options:

The small group plans do not cover IVF;

They do not cover treatment of temporomandibular joint disorders (TMJ);

They limit physical therapy/occupational therapy/speech therapy (PT/OT/ST) to 30

visits/condition annually;

They limit MH/SU impatient hospital and residential treatment benefits to 60 days annually;

They limit chiropractic services to 20 visits per condition annually;

They limit nutrition counseling to six visits annually;

They do not cover smoking cessation; and

They do not offer basic dental coverage for adults.

Among the differences highlighted in their analysis, only the exclusion of IVF and basic dental coverage

for adults (which is only covered in two of the federal employee plans) had a large premium impact of

over $1.00 PMPM. Finally, the small group and HMO plans do not cover four state mandated benefits

that are covered in the state employee plans: IVF, hair prostheses, smoking cessation, and amino acid

elemental formula.

Informed by this analysis, the Committee was asked to discuss the pros and cons of the eligible small

group and HMO plans. The following figures summarize the pros and cons discussed by the Committee

and the public comments received by the Committee pertaining to these plans.

Figure 1: Committee Input on Eligible HMO and Small Group Plans

Pros Cons

The impact of the EHB on out-of-pocket

costs for consumers was a key topic of

discussion. Containing the leanest

package of benefits, the small group and

HMO plans would have the lowest

projected premium impact relative to the

other benchmark options.

This option would most closely match the

plans currently purchased by small

employers and their employees.

The chiropractic benefits offered in the

small group plans, while limited, are more

robust than other plan options and limit

The limits on MH/SU benefits do not

constitute comprehensive MH/SU services

and are not in parity with the medical

benefits offered; therefore, they are not

compliant with MHPAEA.

This option would incorporate most, but

not all, of the state mandates into the

EHB.

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visits on a per condition basis rather than

simply on an annual basis.

Figure 2: Public Comment on Eligible HMO and Small Group Plans

Pros Cons

The plans cover at least some services to treat

obesity, such as bariatric and metabolic

surgery, which are essential to combating the

rising obesity epidemic. (Academy of Nutrition

and Dietetics/ American Society of Bariatric

Physicians/ American Society for Metabolic &

Bariatric Surgery/ Obesity Action Coalition/

Obesity Society)

The plans are supported by the Maryland

Alliance of Dental Plans and Delta Dental,

provided that pediatric dental EHB can be

based on the dental plan purchased most

often by small employers (they cannot be,

however).

While specifics are undetermined, plans

appear to offer coverage for services essential

to cost-effective, comprehensive treatment for

women’s health. (American Congress of

Obstetricians and Gynecologists)

The plans are the leanest, most affordable

option and will, therefore, maximize

accessibility to coverage for consumers and

small employers (League of Life & Health

Insurers of Maryland)

The BlueChoice HMO offers the second best chiropractic care coverage, with more restrictions than the state PPO but more clinical freedom in treatment. (Maryland Chiropractic Association)

The plans exclude benefits for “weight loss

programs.” (Academy of Nutrition and

Dietetics/ American Society of Bariatric

Physicians/ American Society for Metabolic &

Bariatric Surgery/ Obesity Action Coalition/

Obesity Society)

The plans do not cover amino acid elemental

formula (March of Dimes – Maryland-National

Capital Area Chapter, positively noting

coverage of medical foods)

The plans commonly practice limiting the

number of visits or monetary expenditures,

which may be problematic in terms of

adequate coverage for certain services.

(Maryland Addiction Directors Council)

Any phase-out of state mandates will cause

disruptions in coverage. (Hemophilia Federal

of America)

Small group plans are not compliant with

MPHAEA. (Mental Health Association of

Maryland/University of Maryland Carey School

of Law Drug Policy Clinic and co-signers)

Some stakeholders expressed concern about

inadequacy of small group plans, e.g. most

limited MH/SU and other benefits, which lead

employers to purchase additional coverage.

(Maryland Clinical Social Work Coalition and

others)

The lower cost, small group plan options are likely to provide inadequate coverage for people with HIV infection and others with chronic conditions due to increased service limits. (HIV Medical Association)

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B. Eligible State Employee Plans

As with the HMO and small group plan benchmark options, the three largest state employee plans are

offered by CareFirst. The differences in these plans are primarily related to their cost sharing features.

Therefore, the packages of benefits offered in these plans are the same, and the three plans should be

considered identical for the purposes of selecting an EHB benchmark plan.

The Wakely analysis found that the state plans had an overall projected premium impact of $1.50-$2.00

PMPM as compared to the small group and HMO plans. This indicates that the state employee plans are

generally more robust than the leanest option, but not by a significant amount. The key differences in

benefits offered between the state employee plans and the other benchmark plans include the

following:

The state employee plans cover IVF;

They only cover acupuncture for pain management;

They only cover medically necessary spinal manipulation for chiropractic services;

They limit home health care to 120 visits per year (40 home health aide visits per year);

They do not offer basic dental coverage for adults;

They limit PT/OT/ST to 50 days per year;

They only explicitly cover habilitative services for children (19 years old and under); and

They do not cover pediatric dental and vision services (it is important to note that pediatric

dental and vision and habilitative services would need to be supplemented to meet ACA

requirements regardless of which plan is chosen).

Again, Wakely found that the only benefit differences with a significant premium impact (over $1.00

PMPM) were that the state employee plans cover IVF, making them more robust than other plans in this

area, and that they do not cover basic adult dental benefits, making them leaner than two of the federal

employee plans. Finally, the state employee plans were the only benchmark options that covered all

state health insurance coverage mandates.

Figure 3 below summarizes the discussion by the Committee regarding the pros and cons of the state

employee plan benchmark options while Figure 4 summarizes the public comments that were relevant

to the pros and cons of the state employee plans.

Figure 3: Committee Input on Eligible State Employee Plans

Pros Cons

The state employee plans cover all state

health insurance coverage mandates (the

state has the opportunity to select a

benchmark that includes the state

mandates without incurring additional

costs to the state).

This option may represent the best

The MH/SU benefits offered in these plans

are more substantial than those offered in

the small group/HMO plans and comply

with current state MH/SU coverage

mandates, but they may not comply with

the requirements of MHPAEA.

There may be a potential for adverse

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balance of quality and affordability for

MH/SU benefits.

Benefit determinations are generally

based on medical necessity.

These plans are more comprehensive than

the small group/HMO plans, and even

though they are more expensive, much of

the cost difference could be because of

underwriting policies that could be more

circumscribed in the Exchange.

These plans better reflect the benefit

priorities of the citizenry because they

include all benefit mandates.

These plans offer particularly strong

benefits in several areas, including a high

number of days of skilled nursing care and

home health visits.

These plans seem to offer the most

complete coverage for families and people

with special health care needs in a cost

effective manner.

selection for plans outside the Exchange if

IVF is included in the EHB package.

Increased mandatory benefits could have

an impact on premiums or payments at

the time of service.

More comprehensive plans could drive up

costs too much and make it more difficult

to sign currently uninsured individuals and

businesses up for coverage inside the

Exchange.

Figure 4: Public Comment on Eligible State Employee Plans

Pros Cons

The plans cover at least some services to treat

obesity, such as bariatric and metabolic

surgery. (Academy of Nutrition and Dietetics/

American Society of Bariatric Physicians/

American Society for Metabolic & Bariatric

Surgery/ Obesity Action Coalition/ Obesity

Society)

Specifics are undetermined, but the plans

appear to offer coverage for services essential

to cost-effective, comprehensive treatment for

women’s health. (American Congress of

Obstetricians and Gynecologists)

The plans cover all state-mandated benefits

and are, therefore, supported by those who

believe all existing mandates should be

The plans exclude benefits for “weight loss

programs.” (Academy of Nutrition and

Dietetics/ American Society of Bariatric

Physicians/ American Society for Metabolic &

Bariatric Surgery/ Obesity Action Coalition/

Obesity Society)

The plans cover acupuncture only for pain

management. (Maryland Acupuncture

Society)

It is unclear whether the plans are MHPAEA

compliant. (Mental Health Association of

Maryland/University of Maryland Carey School

of Law Drug Policy Clinic and co-signers)

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retained and/or that any phase-out of

mandates should be informed by possible

disruptions in coverage. (Eisai Inc.; Hemophilia

Federation of America)

The plans offer coverage for habilitative

services most in parity with rehabilitative

services, and in contrast to federal plans, also

provide treatment of congenital or genetic

birth defects for children 0-19. (March of

Dimes – Maryland-National Capital Area

Chapter)

Some organizations recommend adopting one

of the plans and substituting the GEHA MH/SU

benefits to ensure MHPAEA compliance and

comprehensive coverage for residential

treatment (Maryland Addiction Directors

Council; National Council on Alcoholism &

Drug Dependence – Maryland Chapter)

Some organizations recommend adopting one

of the plans and modifying it to conform to

MHPAEA, since all state mandates are included

and benefits are comprehensive without being

too costly. (Mental Health Association of

Maryland/University of Maryland Carey School

of Law Drug Policy Clinic and co-signers;

Maryland Women’s Coalition for Health Care

Reform)

The state PPO offers the best coverage for

chiropractic care. (Maryland Chiropractic

Association)

C. Eligible Federal Employee Plans

The eligible federal employee plans are offered by two carriers — two are sold by BlueCross BlueShield

(BCBS) and one is offered by the Government Employees Health Association (GEHA). In general, the

Wakely analysis found these plans to be more robust than the small group and HMO plans with a $0.75-

$1.25 PMPM premium impact of benefit differences for the BCBS Standard plan, a $8.00-$10.00 PMPM

difference for the GEHA Standard plan, and a $8.75-$11.00 PMPM difference for the BCBS Basic plan.

The key differences in benefits highlighted by the analysis include the following:

The BCBS Basic and GEHA plans offer limited adult dental benefits;

None offer IVF coverage or fertility drugs;

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All offer acupuncture and chiropractic services, but the BCBS Basic offers the most robust

benefits;

All limit home health care visits (25 or 50 visits per year);

The GEHA plan offers the most comprehensive set of MH/SU benefits of all ten eligible plans;

The BCBS Basic plan does not provide a skilled nursing benefit;

All offer smoking cessation benefits;

None explicitly cover habilitative services (these benefits would need to be supplemented to

meet ACA requirements); and

All offer limited pediatric vision and dental benefits (these benefits would need to be

supplemented to meet ACA requirements).

Wakely found that the primary drivers of premium impact differences were the addition of dental

benefits for BCBS Basic and GEHA plans (increasing costs relative to other plans) and the exclusion of

assisted reproductive therapy and fertility drugs (reducing costs in this area relative to the state

employee plans).

With respect to coverage of state health insurance coverage mandates, the BCBS plans:

Do not cover IVF;

Limit home health care visits to 25 per year rather than 40 per year;

Limit hearing aid benefits for children to $1,250 per ear per year rather than $1,400 per ear per

year; and

Do not explicitly cover habilitative services.

The GEHA plan:

Does not cover hair prostheses;

Does not cover IVF;

Limits hearing aid benefits for children to $1,250 per ear per year rather than $1,400 per ear per

year; and

Does not explicitly cover habilitative services.

Figure 5 summarizes the discussion by the Committee regarding the pros and cons of the federal

employee plan benchmark options while Figure 6 summarizes the public comments that address the

pros and cons of the federal employee plans.

Figure 5: Committee Input on Eligible Federal Employee Plans

Pros Cons

The GEHA plan MH/SU benefits include

residential treatment.

The GEHA plan MH/SU benefits are the

most comprehensive and most likely to

comply with MHPAEA parity requirements.

The federal employee plans cover the

fewest state mandates (including IVF).

The plans that offer adult dental benefits

(BCBS Basic and GEHA) have the highest

projected premium impact.

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The BCBS Basic and GEHA plans both have

limited adult dental benefits, which could

be very beneficial to enrollees. These are

the only plans that offer limited adult

dental benefits.

More comprehensive plans could drive up

costs too much and make it more difficult

to sign currently uninsured individuals and

businesses up for coverage inside the

Exchange.

The BCBS Standard and GEHA plans

severely limit chiropractic benefits, which

could drive patients to higher cost services

that have better coverage.

Figure 6: Public comment on eligible federal employee plans

Pros Cons

Specifics are undetermined, but the plans

appear to offer coverage for services essential

to cost-effective, comprehensive treatment for

women’s health. (American Congress of

Obstetricians and Gynecologists)

The GEHA plan offers spiritual care services

from Christian Science practitioner services,

nursing care, and nursing facility care.

(Christian Science Committee on Publication

for Maryland)

The plans offer habilitative services in greater

parity to rehabilitative services than do the

small group and HMO plans. (March of Dimes

– Maryland-National Capital Area Chapter)

The GEHA plan’s MH/SU benefits best ensure

compliance with MHPAEA as well as

comprehensive coverage for residential

treatment, which is the equivalent of skilled

nursing care. (Maryland Addictions Directors

Council; National Council on Alcoholism &

Drug Dependence – Maryland Chapter)

The GEHA plan’s substance use disorder

benefits include residential treatment.

(Mental Health Association of

Maryland/University of Maryland Carey School

of Law Drug Policy Clinic and co-signers)

The BCBS Basic plan offers the third best

The plans do not offer habilitative services for

treatment of congenital or genetic birth

defects for children 0-19, in contrast to state

employee plans. (March of Dimes – Maryland-

National Capital Area Chapter)

The BCBS Basic plan restricts payment of

acupuncture benefits to physicians only,

instead of also allowing payment to licensed

acupuncturists. (Maryland Acupuncture

Society)

Any phase-out of state mandates will cause

disruptions in coverage. (Hemophilia Federal

of America)

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chiropractic care, allowing for a greater

number of spinal manipulations. (Maryland

Chiropractic Association)

Some organizations recommend adopting the

federal plans that contain limited adult dental

benefits (assuming federal subsidies are

applicable to this benefit if included in EHB).

(Maryland Citizens Health Initiative; Maryland

Dental Action Network)

One organization suggests selecting a federal

plan because of their coverage of cochlear

implants (Maryland Citizens Health Initiative).

The BCBS Standard option is the only plan that

covers basic dental services that go beyond

minimal preventative and diagnostic care.

(DentaQuest)

Federal plans cover all available drugs

approved by the FDA through an open

formulary, which provides accessibility and

flexibility for providers and patients. (Pfizer,

Inc.)

Federal plans offer successful models for

recognizing the role of pharmaceuticals in

protecting patients along with access to care

while maintaining affordability. (PhRMA)

SUPPLEMENTARY PEDIATRIC DENTAL AND VISION BENEFITS

The ACA requires that the EHB benchmark include pediatric dental and vision benefits. However, the

Maryland benchmark plan options do not include comprehensive pediatric dental and vision benefits.

Therefore, HHS will require Maryland to supplement the benchmark plan with either the dental benefits

offered through the MCHP Healthy Smiles dental benefits or the FEDVIP MetLife Dental PPO – High

Option dental benefits. HHS also suggested that coverage of orthodontics would not need to be offered

unless medically necessary, even if that benefit exists in the MCHP or FEDVIP plans.

As part of their comparison of EHB benchmark options, Wakely compared the MCHP and FEDVIP dental

benefits. Wakely found that the benefits for the two supplemental options are comprehensive with

minimal differences in limitations and exclusions (assuming the exclusion of orthodontics from the

FEDVIP plan). Further, Wakely’s projected premium impacts for the two options were not significantly

different ($6.25-$7.75 PMPM).

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Figure 7 summarizes the Committee’s discussion of pros and cons for each pediatric dental option while

Figure 8 summarizes the public comments for each option.

Figure 7: Committee Input on Supplementary Pediatric Dental Benefits

FEDVIP

Pros Cons

The FEDVIP dental benefits are

comprehensive.

The FEDVIP dental benefits are not

designed specifically for children.

MCHP

The MCHP dental benefits are

comprehensive.

The MCHP dental benefits are designed to

be appropriate for children.

Figure 8: Public Comment on Supplementary Pediatric Dental Benefits

FEDVIP

Pros Cons

Benefits in this plan are slightly more

comprehensive compared to the MCHP

plan, including a provision for a complete

intraoral or panoramic radiograph once

every five years (a diagnostic tool that is

important during child growth) and

sealants (a critical preventive oral health

service) every three years. (Maryland

Dental Action Coalition)

The FEDVIP plan is employee, not child-

oriented. (Alliance of Maryland Dental

Plans; Delta Dental)

MCHP

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MCHP is a child-oriented dental program.

(Alliance of Maryland Dental Plans; Delta

Dental)

Selection of this program will ensure that

children receive an adequate level of

affordable coverage. (Denta Quest)

Basing the pediatric EHB on this program

will help alleviate coverage disruptions for

those children who are likely to experience

changes in their family’s income level and

transition between Medicaid/MCHP and

the exchange. (Denta Quest)

Some organizations believe that the MCHP

plan provides more limited coverage than

the FEDVIP plan. (Maryland Dental Action

Coalition)

HHS has only provided one option for states to supplement pediatric vision benefits for the benchmark

plan — the FEDVIP Blue Vision High plan. Although Maryland will not have a choice in pediatric vision

benefits, Wakely analyzed the benefits offered in the FEDVIP plan. They found that the plan covers eye

exams, lenses, frames, and contact lenses with both frequency and dollar limitations (dollar limitations

will not be permitted under the ACA, so Wakely assumed a conversion from dollar limit to quantity limit

in order to calculate premium impacts). Finally, the projected premium impact for adding this set of

benefits to a benchmark option plan is relatively low ($1.00-$1.50 PMPM).

CAVEATS/OPEN QUESTIONS

A. Additional HHS Guidance

While this report summarizes the EHB guidance provided by HHS to date, future HHS guidance may

change some of the conclusions in this report regarding the comparison of benchmark plan options. In

particular, HHS will likely provide guidance that clarifies the extent to which plans will be permitted to

substitute benefits for those in the EHB benchmark plan. The amount of flexibility afforded to plans will

have an impact on how the EHB benchmark is applied and on how closely small group and individual

health insurance plans will adhere to the package of benefits included in the benchmark plan.

The flexibility of plans to substitute benefits was a key topic on which the Committee and public

focused. While stakeholders recognized that some flexibility for substituting benefits is necessary in

order for plans to innovate and accommodate appropriate medical management, they also expressed

the concern that too much flexibility could undermine the scope and quality of the benefits included in

the EHB benchmark. These stakeholders indicated that a reasonable set of parameters on flexibility to

substitute benefits would be critical for ensuring that the EHB sets a baseline set of comprehensive

benefits that will be provided by all plans in the small group and individuals markets. Some committee

members recommended that if HHS does not provide adequate guidance, Maryland should consider

adopting its own set of parameters for benefit substitution.

In addition to parameters for benefit substitution, HHS is expected to provide guidance on other key

issues. For example, HHS may provide guidance on how the EHB relates to the requirements of

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MHPAEA. This would certainly impact how plans structure their MH/SU benefits. HHS is also expected

to provide additional guidance on how the EHB benchmark should be applied to habilitative services.

Finally, HHS will likely describe more precisely how the prescription drug benefit in the benchmark plan

will be used to set a baseline for small group and individual market health insurance plans.

B. Caveats of Analysis

Several unknown factors may also impact the results provided in the Wakely analysis. First, the accuracy

of the benefit information is dependent upon the accuracy of the information provided by the insurers

and upon the accuracy of publicly available information. Additionally, the actual premium impact may

vary from the premium impact projections because of factors such as the health insurer issuing the plan,

a plan’s benefit design (metal level), and the demographics of the plan’s enrollees.

CONCLUSIONS

When reviewing the analysis of the benchmark options, the Committee discussion, and public

comments, several key differences between the plans emerge. In particular, while the benchmark

options offer similar packages of benefits, the stakeholder input and analysis highlighted some

differences in coverage for particular benefits such as MH/SU benefits and adult dental benefits.

Further, stakeholders felt that differences in premium impact and coverage of state mandates may also

be meaningful.

A. Premium Impact

There is a fundamental tension between the need to provide adequate coverage for needed health

services and to keep insurance coverage affordable for individuals, small businesses, and carriers.

However, as the Wakely analysis indicates, most of the EHB benchmark options offer similar packages of

benefits. Thus, the projected premium impact relative to the leanest plans is fairly modest with the

highest premium impact being $11.00 PMPM higher. The Wakely analysis further suggests that there

are a small number of benefits that are responsible for the majority of the estimated premium impact.

For example, much of the $1.50-$2.00 PMPM premium impact of the state employee plans relative to

the small group and HMO plans appear to be driven by the coverage of IVF. Likewise, much of the

$8.00-$11.00 PMPM premium impact of the BCBS Basic and GEHA federal employee plans appear to be

driven by the inclusion of adult dental benefits.

In general, the importance of controlling out-of-pocket costs of health insurance plans was a point

stressed by several Committee members and other stakeholders. While these stakeholders recognized

that the decision between EHB benchmark options may not have a large impact on out-of-pocket costs,

they recommended that cost should be a primary factor considered by the HCRCC in selecting an EHB

benchmark option. Further, some stakeholders felt that the target market for the Exchange may be

particularly cost-sensitive and that people with individual health plans may experience substantial

increases in health insurance costs when the EHB goes into effect. For these reasons, these

stakeholders expressed concern about how the affect of the EHB on premiums and payment at time of

service may impact consumers’ decisions to purchase insurance or not.

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B. Mental Health and Substance Use Coverage

Many of the public comments were concerned with coverage for particular MH/SU benefits and

services, the utilization management techniques used by carriers to control access and usage of these

benefits, and whether plans were compliant with MHPAEA. Only the GEHA plan appears to be in

compliance with MHPAEA. Numerous stakeholders suggested using the GEHA plan’s benefits as a

substitute for any other benchmark option’s MH/SU benefit package.

D. Coverage for State Mandated Benefits

With the selection of the benchmark plan, the state has the opportunity to provide coverage for state

mandated benefits without incurring additional costs to the state government. All of the benchmark

options provide coverage for most of these benefit mandates. The state employee plans are the only

ones to provide coverage for all of the mandates; however, while the federal plans provide coverage for

the fewest. It was noted in the public comments that disruption in coverage of any of these mandated

benefits could be harmful to enrollees. The state mandate that garners the most attention and is

responsible for a large portion of premium differences is coverage for IVF treatments. The state

employee plans are the only benchmark options that provide coverage for IVF. Other stakeholders

expressed concern that only the state employee plans covered amino acid elemental formula, an

important benefit for the treatment of some conditions.

C. Pediatric and Adult Dental Coverage

None of the plans provide adequate pediatric dental coverage, so any selected benchmark plan would

need to be supplemented to meet the requirements of the ACA. The two substitution options are

substantially similar in coverage levels and cost, but more organizations supported using the MCHP

program because it was designed to fit pediatric needs. Several stakeholders advocated selecting a plan

that would provide limited dental services for adults as well. The federal plans that do offer this

coverage (BCBS Basic and GEHA), would help adults populations receive minor dental treatments and

screenings that they might not have access to otherwise. This is a major reason these benchmark

options are considerably more expensive that the others, however. At present, it is unknown whether

HHS will allow adult dental services to be included and subsidized in the EHB package.

D. Coverage for Other Conditions and Services

Finally, numerous public comments dealt with the coverage levels provided to a number of different

conditions and services. As an example, chiropractic care is covered by all of the plans but with different

limitations. Stakeholders also highlighted differences in coverage of weight loss programs, acupuncture,

and treatment for HIV/AIDS.