On October 6, the Institute of Medicine released the report Essential Health Benefits: Balancing Coverage and Cost. The report was in response to a request from the Department of Health and Human Services to recommend “criteria and policy foundations” for the Secretary’s determination of the essential health benefits (EHB) required to be offered by qualified health plans participating in the new state health insurance exchanges established by the Patient Protection and Affordable Care Act (ACA).
Early press coverage, which is often the public’s only impression of such reports, pretty much got it right: the report called for a balancing of the comprehensiveness of coverage with the affordability of the benefit package. If cost were not taken into account in constructing benefits, the resulting package would rapidly become unaffordable, frustrating the central intent of the ACA, which was to make health insurance more available to more people.
But early reports often miss points that will become quite important when implementation of the recommendations begins. The report recommended that the Secretary begin with what a typical small employer (who, along with individuals, will be the major purchaser in the exchanges) currently offers, supplement that benefit package with the ten categories of services specified in the ACA (for example, mental health and substance abuse services and pediatric oral and vision care), and adjust the package to fit a premium target (what a small employer would have paid in 2014 in absence of the ACA). It is that adjustment that will be very important.
In effect, the report recommended that the Secretary take a ten-pound package, add a few ounces, and put it into a ten-pound bag. This means that the Secretary must remove some items from the original ten pounds. But the report also gave the Secretary the means to do so. Building on the four policy foundations—economics, ethics, evidence-based medicine, and population health—developed in the report (Figure 1), three types of criteria are recommended: criteria to guide the content of the aggregate EHB package, criteria to guide specific components, and criteria to guide the methods for defining and updating the EHB. For example, population health informs the criteria “address the medical concerns of greatest importance” and “demonstrate meaningful improvement in outcomes over current effective services.” Ethics informs the criteria “protect the most vulnerable” and “attentive to stewardship.”
How, then, does the Secretary remove the few unnecessary ounces? By first applying the aggregate criteria, then the content-specific criteria: for an individual service, is it safe? Is it effective? Does it demonstrate meaningful improvement? Is it a medical service? Is it cost effective? In effect, the report asks the Secretary to apply science to policy decisions.
But a second step is equally important. The report recommends that the Secretary apply values, in addition to science, to her policy decisions. Through a structured public deliberative process—not a town meeting—the Secretary can gain an understanding of how the public (people who will purchase insurance through the exchanges and ordinary taxpayers) values specific health services, and how the public would make tradeoffs between competing goods.
Start with what is—the benefits people have now; learn—from science and values; and make it better over time: a prescription for how to make health care better and more affordable.
John R. Ball, MD, JD is a retired medical executive, having served as chief executive officer of the American College of Physicians, Pennsylvania Hospital, and, most recently, the American Society for Clinical Pathology. He chaired the IOM Committee on Defining and Revising an Essential Health Benefits Package for Qualified Health Plans.
Very nice summary - welcome cool head. Eventually, we will have to figure out long-term-care in our calculus of access and insurance. CLASS's demise makes that even more pressing. Would be good to include that in our scope of concern, even though we are not yet ready to include it in our scope of required insurance elements.
Posted by: Joanne Lynn | 10/20/2011 at 12:38 PM