Institute of Medicine Releases Essential Benefits Package Report

by Rebecca Farley on October 13, 2011

On Friday, October 7, the Institute of Medicine (IOM) released its highly anticipated report outlining the criteria and process by which the Department of Health and Human Services should select benefits for inclusion in the Essential Health Benefits (EHB) package created under the Affordable Care Act. Among the key components of the report were:

  • A focus on the affordability of coverage over the comprehensiveness of benefits. The IOM recommended that “the EHB should be defined as a package that will fall under a predefined cost target rather than building a package and then finding out what it would cost.”
  • The decision to define a “typical employer plan” as a typical small employer plan. The ACA requires the EHB to be comparable in scope to a typical employer plan. Based on the available data, the report found that the scope of benefits is usually comparable for large and small employer plans; however, small employer plans often make use of tighter provider networks and utilization management.
  • A recommendation against incorporating state mandates into the EHB. IOM noted that while the ACA does give HHS the authority to do so, state mandates should not receive special treatment.
  • A recommendation that HHS consult Medicaid plan benefits for information to help decide the scope of certain services, including mental health and substance use disorder benefits. Recognizing that the public sector has been the primary source of coverage for many important MH/SUD benefits, the report suggested that Medicaid plans could provide important guidance on how services such as habilitation could be covered.
  • A suggestion that HHS should establish its initial draft of the essential health benefits plan by May 1, 2012.

Unfortunately, the report did not indicate how HHS should apply the requirements of the 2008 Mental Health Parity and Addictions Equity Act in the selection of the EHB. The ACA extends the 2008 law to cover all health plans sold on the health insurance exchanges, as well as Medicaid benchmark plans. The report’s suggestion that small employer plans should be used as the basis for a “typical employer plan” is also concerning, given the frequently inadequate coverage of mental health and addictions services under such plans. However, the report did recognize the importance of looking to Medicaid plans to inform decisions about mental health and addictions services. It also reiterated Congress’ intent to remediate shortcomings in current coverage options by expressly identifying mental health and substance use benefits for inclusion in the EHB.

Now that the IOM has issued its report, HHS will begin the process of selecting benefits for inclusion in the EHB. It is critical for the mental health and addictions field to continue to advocate for the strongest possible inclusion of MH/SUD benefits throughout this process. Stay tuned to the Public Policy Update for the latest news and opportunities to get involved.


share this article on your social site
  • Facebook
  • Google Bookmarks
  • Twitter
  • Technorati
  • Digg
  • StumbleUpon
  • LinkedIn
  • Live
  • Reddit
  • Slashdot
  • Tumblr
  • Yahoo! Bookmarks

{ 1 comment… read it below or add one }

Alyssa Ast October 17, 2011 at 6:29 pm

I think it’s a great start. I’m interested to see what will come of it.


Leave a Comment

Previous post:

Next post: