Health Care Reform: Essential Benefits

This is another installment in our continuing series on the affirmative provisions of H.R. 3200, the health reform bill currently pending in the House of Representatives. For earlier installments, scroll down the page.

To repeat what we have said before, if you read the actual proposed legislation, a primary source of factual information, you will have armed yourself against the thugs and hooligans who are trying to shout down all reasonable discussions about reforming America's broken health care system. Do not rely on untrustworthy secondary sources, like "Ross" who left comments a few days ago at the end of this post that make it clear he doesn't know the difference between a primary source and a prime rib.

Notice, if you will, that all the despicable Palins and Grassleys and, yes, even lowly bloggers like our "Ross" fellow, never quote a primary source -- such as the draft legislation known as H.R. 3200 -- to show us a factual basis for their inane arguments. As Darren Hutchinson wrote Thursday (filling in for Glenn Greenwald), critics of health care reform never "point to any specific language in the bill."

Why not? As Hutchison says, because "facts mean nothing in a smear campaign."

So much ink and so many television pixels have been wasted on the shouting bullies and Ross-like rutabaga-heads trying to disrupt town meetings or clutter message boards that the core provisions being proposed for health care reform have been buried under all the garbage. Yet, those essentials are plainly set out in an early section of H.R. 3200:

SEC. 122. ESSENTIAL BENEFITS PACKAGE DEFINED.

(a) In General- In this division, the term `essential benefits package' means health benefits coverage, consistent with standards adopted under section 124 to ensure the provision of quality health care and financial security, that--

(1) provides payment for the items and services described in subsection (b) in accordance with generally accepted standards of medical or other appropriate clinical or professional practice;

(2) limits cost-sharing for such covered health care items and services in accordance with such benefit standards, consistent with subsection (c);

(3) does not impose any annual or lifetime limit on the coverage of covered health care items and services;

(4) complies with section 115(a) (relating to network adequacy); and

(5) is equivalent, as certified by Office of the Actuary of the Centers for Medicare & Medicaid Services, to the average prevailing employer-sponsored coverage.

(b) Minimum Services To Be Covered- The items and services described in this subsection are the following:

(1) Hospitalization.

(2) Outpatient hospital and outpatient clinic services, including emergency department services.

(3) Professional services of physicians and other health professionals.

(4) Such services, equipment, and supplies incident to the services of a physician's or a health professional's delivery of care in institutional settings, physician offices, patients' homes or place of residence, or other settings, as appropriate.

(5) Prescription drugs.

(6) Rehabilitative and habilitative services.

(7) Mental health and substance use disorder services.

(8) Preventive services, including those services recommended with a grade of A or B by the Task Force on Clinical Preventive Services and those vaccines recommended for use by the Director of the Centers for Disease Control and Prevention.

(9) Maternity care.

(10) Well baby and well child care and oral health, vision, and hearing services, equipment, and supplies at least for children under 21 years of age.

(c) Requirements Relating to Cost-sharing and Minimum Actuarial Value-

(1) NO COST-SHARING FOR PREVENTIVE SERVICES- There shall be no cost-sharing under the essential benefits package for preventive items and services (as specified under the benefit standards), including well baby and well child care.

(2) ANNUAL LIMITATION-

(A) ANNUAL LIMITATION- The cost-sharing incurred under the essential benefits package with respect to an individual (or family) for a year does not exceed the applicable level specified in subparagraph (B).

(B) APPLICABLE LEVEL- The applicable level specified in this subparagraph for Y1 is $5,000 for an individual and $10,000 for a family. Such levels shall be increased (rounded to the nearest $100) for each subsequent year by the annual percentage increase in the Consumer Price Index (United States city average) applicable to such year.

(C) USE OF COPAYMENTS- In establishing cost-sharing levels for basic, enhanced, and premium plans under this subsection, the Secretary shall, to the maximum extent possible, use only copayments and not coinsurance.

(3) MINIMUM ACTUARIAL VALUE-

(A) IN GENERAL- The cost-sharing under the essential benefits package shall be designed to provide a level of coverage that is designed to provide benefits that are actuarially equivalent to approximately 70 percent of the full actuarial value of the benefits provided under the reference benefits package described in subparagraph (B).

(B) REFERENCE BENEFITS PACKAGE DESCRIBED- The reference benefits package described in this subparagraph is the essential benefits package if there were no cost-sharing imposed.

This section accomplishes several key goals that are equivalent to, and in several respects better than, most existing private insurance plans. It also addresses the new medical reality that, increasingly, prescription drugs are the most common, and among the most expensive, forms of medical treatment.

For now, we'll concentrate on three of the larger aspects of Section 122.

First, one huge reform is that no "annual or lifetime limit on the coverage of covered health care items and services" would be imposed. If your child, for example, has the misfortune to need especially expensive or long-term medical care -- say, because of Down's Syndrome -- under H.R. 3200, the insurance company could not refuse to pay after the bills hit a certain arbitrary ceiling level. To this extent, continuing medical care coverage is guaranteed for all insureds, just as it is now by federal medical insurance programs such as that provided by the Veterans Administration.

Second, "cost sharing" continues just as it does now under most for-profit insurance policies. But H.R. 3200 would limit the cost-sharing to, roughly, a maximum of 70-30 and no more than $5,000 for an individual and $10,000 for a family" per year.

Third, no cost-sharing is allowed for certain preventive health services, such as "well baby" and "well child care" services. Preventive medical care really does work, as numerous medical studies have established. H.R. 3200 promotes preventive care for children by lowering the out-of-pocket costs for parents who seek to have their infants treated at the earliest sign of medical trouble. Presently, many parents, particularly those among the 47 million who no longer can afford insurance, defer things too long by wishful thinking. By the time they seek medical treatment for a sick child, things have gone from bad to worse and treatment often becomes much more costly.

All of this brings to mind a young mother we once knew who had three exceptionally bright children. The two boys had Duchenne's Muscular Dystrophy, a condition that usually doesn't become manifest until age two or three. It's almost invariably fatal by the late 20's or early 30's. The woman's husband, a wealthy St. Louis businessman, left her and the children to fend for themselves.

The husband looked to escape by suing for divorce. Eventually, a settlement was approved by the divorce court under which he was obligated to continue paying for the health insurance policies he had taken out on each of the children when they were born.

Little did the mother or the judge realize at the time that the policies contained a "lifetime" maximum limit on health benefits, or that the described limit would be exceeded by the time the boys were 13 and 11, mostly due to unprecedented inflation, well above the national CPI average, in medical and hospital costs. When the children maxed out on the policy, the insurance company refused to pay the pending bills and dropped the kids.

The now-absent father shrugged his shoulders. 'It's not my problem,' he said. 'The court approved the policy." He also argued, probably correctly, that all the other policies on the market had a lifetime maximum, too.

The mother couldn't buy another health insurance policy anywhere else due to "prior medical conditions." So, she was ruined and took bankruptcy. The cost of the bankruptcy, of course, fell most heavily on the innocent creditors, the mother, the children, the doctors and the hospital where the boys has been treated previously, and the public.

Now that they had become destitute, future medical care was provided by Medicaid. But the program had no authority to pay past medical bills which the private insurer had turned down.

Needless to say, the absent father, his new trophy wife, and the health insurance company did very well for themselves.

Just like commentator "Ross," whose various comments reveal a deplorable disregard for anyone other than himself, the ex-husband didn't think the boys' health was his problem anymore. For him, as with "Ross," when it comes to medical care every man is an island. Such people are not "involved in mankind" and the bell will never toll for them.

Or, so they think.