Essential Health Benefits
When the insurance mandate goes into effect on January 1 2014, as part of the Affordable Care Act, health insurers will be required to offer new categories of health insurance plans to consumers (Bronze, Silver, Gold & Platinum Plans). Each of these four levels of health plans, will contain a minimum core set of health benefits, otherwise known as "essential health benefits". The required benefits include some items & services from within each of the following 10 categories:
- Ambulatory Services
- Emergency Services
- Maternity & Newborn Care
- Mental Health & Substance Abuse Treatment
- Prescription Drugs
- Rehabilitation Services & Devices
- Laboratory Services
- Preventative & Wellness Services & Chronic Disease Mgmt.
- Pediatric Services (incl. Dental & Vision)
While all four coverage tiers will be required to provide coverage in each of these areas listed above, each coverage tier will vary in their "Actuarial value" -- or how much of the cost will be covered before the member must pay out-of-pocket. The actuarial value between the four plans will vary between 60% - 90%
Bronze Plans are intended to have the lowest monthly premiums of the four coverage tiers, and as you might expect require the largest amount of out-of-pocket costs to the consumer. These plans provide the lowest amount of health insurance coverage that satisfy
By design with Bronze Plans, the insurer would be required to cover 60% of covered healthcare expenses (above and beyond monthly premiums) with you the member being responsible for the remaining 40%.
Silver Plans will likely result in lower out-of-pocket costs than Bronze Plans, but a higher monthly premium. Silver plans are designed to cover 70% of covered healthcare expenses and the responsibility for the remaining 30% resting on the shoulders of the member. As with the Bronze Plan above, this cost sharing occurs exclusive of the monthly premiums for which you are required to pay.
Unlike the Bronze Plan above, health insurers are required to offer at least one silver plan in their portfolio of products.
Gold Plans represent the category with the second highest actuarial value of the four plan categories. With Gold Plans, the insurer is responsible for 80% of the covered healthcare expenses and the member 20%. Only the Platinum Plan covers a higher % of healthcare costs that Gold Plans.
Like Silver Plans above, health insurers are required to offer at least one Gold Plan to health insurance shoppers.
Platinum Plans will be the Cadillac of health insurance plans in the individual & small group markets come 2014. Of the four plans, they cover the highest % of healthcare expenses (90%) and the lowest out of pocket costs -- after monthly premiums of course. Health insurers are not required to offer Platinum Plans.
Written by Jeff Levy