By Gregory Kane, J.D., M.B.A.
States replacing their benchmark plan selections may use another state’s 2017 plan or category, or propose their own set of benefits.
CMS updated guidance provided to states regarding changes in regulation for Medicaid alternative benefit plans (ABPs) inclusion of essential health benefits (EHB). States may continue to use their current benchmark plan selection, but if the state decides to change its benchmark plan used to define EHB in its ABP or implement a new ABP, then the state must choose one of three options to define EHP for its ABP (CMCS Informational Bulletin, August 8, 2019).
In 2018, HHS finalized changes to provide new flexibility to states on EHB that impact Medicaid ABPs (83 FR 16930). ABPs authorized under section 1937 of the Social Security Act must include the EHB in one of the 10 base-benchmark plans:
- the largest health plan by enrollment in any of the three largest small group insurance products by enrollment;
- any of the largest three employee health benefit plan options by enrollment available to state employees;
- any of the largest three national Federal Employees Health Benefits Program plan options by aggregate enrollment;
- the coverage plan with the largest insured commercial non-Medicaid enrollment offered by a health maintenance organization operating in the state.
New regulations. States may continue to use current benchmark plan selections, including amendments to its existing ABP. If a state decides to change its benchmark plan used to define EHB in its ABP or to implement a new ABP in which an initial benchmark plan selection is required and is not the same as the state’s benchmark plan chosen for the commercial market, then the state must choose one of the following three options to define EHBs:
- propose a set of benefits.
- replace category or categories with categories from another state’s EHB-benchmark plan; or
- select an EHB-benchmark plan from another state;
The EHB-benchmark plan must meet coverage and scope of benefit standards under 45 C.F.R. §156.111(b) and the scope of benefits must be equal to, or greater than, the scope of benefits provided under a typical employer plan. States must document meeting these requirements through an actuarial certification and associated actuarial report.
Additional guidance. States choosing to update the benchmark plan selection used to define EHB using one of the new options will be required to submit an SPA and provide the public with advance notice for a reasonable opportunity to comment on such amendment. The CMCS provided additional Q&A information in an attachment to the bulletin as well as an example of one acceptable methodology for comparing benefits of a state’s EHB-benchmark plan selection.
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