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What are essential health benefits?

One important protection included in the Affordable Care Act (ACA) is the establishment of a package of essential health benefits that must be included in every private, individual and small group health insurance plan, inside and outside of small group plans. Essential Health Benefits do not apply to self-insured plans (regardless of group size), fully insured Large Group plans, or any grandfathered plans.

What benefits will be included in essential health benefits?

While the ACA sets a standard for the range of benefits health plans must cover, depending on the plan's actuarial value, a consumer’s cost-sharing for those benefits could vary.

The essential health benefits are intended to mirror those provided under a typical employer-sponsored health plan. The essential health benefits are:

  • Ambulatory patient services, such as doctor's visits and outpatient services
  • Emergency services
  • Hospitalization
  • Maternity and newborn care
  • Mental health and substance use disorder services, including behavioral health treatment
  • Prescription drugs
  • Rehabilitative and habilitative services and devices
  • Laboratory services
  • Preventive and wellness services and chronic disease management
  • Pediatric services, including oral and vision care

Some ACA requirements apply to Large Group Plans. There will be more information on these requirements to come

What is the Affordable Care Act’s (ACA) Employer Mandate?

One important detail of the Affordable Care Act is the Employer Mandate. The Employer mandate is a penalty that will be incurred by employers with more than 50 employees if they do not offer health insurance to their full-time workers.

This provision was included to discourage employers from considering dropping their current insurance plans once the insurance exchanges begin operating as an alternative source of insurance.

The intent of the employer mandate (along with a grandfather clause in the ACA) is to help ensure that existing employer-sponsored insurance plans that people like will stay in place.