Reform 2014: Plan Options and Benefits

Last week we told you about basic reform legislation planned for implementation in 2014, including health benefit exchange options, plan pre-requisites, pooling and risk-sharing.

What legislation will be enacted in 2014 regarding plan options and benefits?

Reforms scheduled for 2014 also address plan options and benefits. Among these are the following:

  • Essential health benefits package.

HHS must define an “essential health benefits package,” (EHB) which health insurance issuers in the individual and small-group market must comply with. Under proposed rules, each state may select a “base benchmark” plan to serve as the basis for determining EHB within that state. The coverage in this base benchmark plan will be supplemented as necessary to create a benefits package that provides 10 statutorily specified categories of benefits.

  • Actuarial value and metal level plans.

Health insurance coverage in the individual and small group markets must fall into one of four benefit levels:

  •           Bronze, with an actuarial value of 60 percent;
  •           Silver, with an actuarial value of 70 percent; 
  •           Gold, with an actuarial value of 80 percent; or 
  •           Platinum, with an actuarial value of 90 percent.

In addition, health plans offering coverage through an exchange must offer a child-only policy (under age 21) and may offer a catastrophic-only policy to young adults (under age 30) and other individuals who are exempt from the ACA’s individual responsibility (generally, individuals who would experience a hardship purchasing coverage).

  • Clinical trials. This provision prohibits the denial, limitation or imposition of additional conditions on coverage for “routine patient costs” associated with approved clinical trials. There are numerous reforms scheduled for 2014 designed to address affordability. These include the following:
  • Tax credits for health insurance premiums. This provision provides for refundable tax credits to individuals with incomes between 100 percent and 400 percent of the federal poverty level to cover purchases of qualified health plans on the Health Benefit Exchange.
  • Small employer tax credit. This provides a tax credit for qualified small employers (those with no more than 25 full-time employees averaging annual wages of no more than $50,000) for contributions to purchase health insurance for their employees from a Health Benefit Exchange. Tax credits phase in beginning in 2011.
  • Cost-sharing reductions. This provision reduces out-of-pocket maximum limits and other cost-sharing for individuals with incomes between 100 percent and 250 percent of the federal poverty level who purchase certain plans through the exchange.
  • Personal responsibility requirement (individual mandate). This provision requires that all U.S. citizens and legal residents must purchase insurance coverage or face a penalty (unless exempted from the mandate for reasons such as religious convictions, status below the income-tax-filing threshold, etc.).
  • Employer responsibility requirement. Large employers (at least 50 employees) must pay a significant penalty if they do not offer health insurance coverage to employees and any of their employees receive premium tax credits for purchasing coverage through an Exchange.

For More Information on these regulations and more on the ACA mandates and changes, contact us at: or visit our website at:



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