By Thomas L. Boyer

The Affordable Care Act (ACA or Obamacare) requires medical insurance coverage to provide several new benefits and include a variety of standards some of which have already been implemented such as children may remain on their parents’ insurance until age 26, there can be no maximum to the amount of benefit paid and no one can be refused medical insurance because of a pre-existing condition. Although these and other requirements raise the cost of medical insurance to some extent, they were fairly easily absorbed by the medical insurance system. However, the ACA also specifies 10 benefits that must be included in all health insurance plans beginning January 1, 2014. Providing these 10 essential benefits is resulting in significant policy changes and higher premiums.

Including group medical plans, few existing health plans meet the new ACA essential health benefits standards. The first people to be affected are those who maintain individual medical plans virtually none of which provide all 10 of these essential coverages. Primarily young people, if they have medical coverage at all, purchase individual plans that cover only catastrophic medical situations and rely on their generally good health to keep them out of doctors’ offices and away from prescription drugs. These individual policies are relatively cheap. Because these limited policies cannot exist in the future, insurance carriers are canceling these policies and replacing them with plans that cover the ACA’s essential benefits. These replacement policies generally result in much higher premiums.

The 10 essential benefits specified by the ACA are the following:

1. Ambulatory Patient Services. This is care a person receives without being admitted to a hospital such as medical service at a same-day surgery center.

2. Emergency Services. These services are for conditions which if not immediately treated could lead to a more serious condition.

3. Hospitalization. Hospitalization is care you receive as a patient in a hospital including room and board and medical care.

4. Maternity and Newborn Care. This is care provided to women during pregnancy and to care for newly born children.

5. Mental Health and Substance Use Disorder Services Including Behavioral Treatment. This care includes the evaluation, diagnosis and treatment of mental health and substance abuse.

6. Prescription Drugs. These are drugs prescribed by a doctor to treat an acute illness or an ongoing condition.

7. Rehabilitative and Habilitative Services and Devices. These services cover prosthetics and other devices and physical rehabilitation.

8. Laboratory Services. This is the testing of blood, tissues, urine, etc. from a patient to assist in the diagnosis and treatment of a medical condition.

9. Preventive and Wellness Services and Chronic Disease Management. Preventive or wellness services include physicals, screenings and immunizations such as mammograms and PSA testing.

10. Pediatric Services Including Oral and Vision Care. These are the other 9 essential benefits applied to children.

Pediatric services, especially dental and optical care are rarely covered by medical plans without riders or separate dental coverage. Prenatal, delivery and postnatal health care and inpatient and outpatient substance abuse services are not covered by many medical plans. Only under the rarest of circumstances would individual insurance plans cover pediatric, maternity or substance abuse services.

The purpose of this article is not to argue for or against whether it should be mandated that these 10 essential health benefits be included in every medical policy. My purpose in preparing this article is to explain, at least to some extent, why there is a controversy concerning the cancellation of the insurance plans and the replacement of those plans with more expensive coverage. The ACA is extensive, complicated, and changing. It is very difficult to understand all or even most of the aspects of the legislation. If you have questions, please do not hesitate to contact us.

For further information regarding these matters, please contact Mr. Boyer at 248.740.5666 or click here to send an email.

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