Com­par­i­son shopping

Sum­mary-of-ben­e­fits form draws mixed re­views

Modern Healthcare - - The Week In Healthcare - Rich Daly

The Obama ad­min­is­tra­tion’s draft of stan­dard­ized forms to help Amer­i­cans com­pare health plans drew praise from sup­port­ers of the fed­eral health­care over­haul. Ad­vo­cates for in­sur­ers and busi­nesses, though, say the bur­den of cre­at­ing the forms may out­weigh the ben­e­fits to con­sumers.

Pro­posed rules is­sued last week by HHS and the la­bor and trea­sury de­part­ments would re­quire that health in­sur­ers pro­vide prospec­tive ben­e­fi­cia­ries with stan­dard­ized in­for­ma­tion about poli­cies, be­gin­ning in March 2012, un­der a pro­vi­sion of the Pa­tient Pro­tec­tion and Af­ford­able Care Act.

The reg­u­la­tions would re­quire an eight­page tem­plate of in­for­ma­tion on each type of in­surance plan of­fered that in­cludes com­pa­ra­ble in­for­ma­tion sim­i­lar to the fed­er­ally man­dated nu­tri­tion la­bels on many foods.

“The idea is that the more in­formed the pa­tient is, the bet­ter the de­ci­sion that he or she can make,” CMS Ad­min­is­tra­tor Dr. Don­ald Ber­wick said dur­ing a me­dia con­fer­ence call. “Many times peo­ple will make de­ci­sions on cov­er­age and not un­der­stand what they are go­ing to get un­til they are sick.”

The pro­posed sum­mary of ben­e­fits and cov­er­age also would in­clude a uni­form glossary of com­mon in­surance terms, as well as cov­er­age ex­am­ples to il­lus­trate costs to pa­tients un­der each plan for three com­mon ben­e­fit sce­nar­ios: hav­ing a baby, treat­ing breast can­cer and man­ag­ing di­a­betes. Reg­u­la­tors may add more sce­nar­ios in the fu­ture, ac­cord­ing to fed­eral of­fi­cials.

Sup­port­ers of that law said the in­for­ma­tion was needed to counter the prac­tice of in­sur­ers re­leas­ing only “selec­tive de­tails” on their plans be­fore pur­chase that leaves con­sumers with an in­com­plete un­der­stand­ing of the spe­cific ben­e­fits and lim­i­ta­tions of the pol­icy.

“In the past, ex­pla­na­tions of ben­e­fits have of­ten been long, con­fus­ing and writ­ten in le­gal gob­bledy­gook that no one could un­der­stand,” Ron Pol­lack, ex­ec­u­tive di­rec­tor of Families USA, a staunch ad­vo­cate of the fed­eral health­care law, said in a writ­ten state­ment. “De­ci­pher­ing ba­sic in­for­ma­tion about health in­surance plan ben­e­fits could be as chal­leng­ing for con­sumers as learn­ing a new lan­guage—with­out a good trans­la­tion dic­tionary.”

Also, the pro­posed plain-English ben­e­fit de­scrip­tions could en­cour­age com­pe­ti­tion in the health in­surance mar­ket­place, ac­cord­ing to fed­eral of­fi­cials and ad­vo­cates, by eas­ing com­par­i­son shopping for con­sumers.

America’s Health In­surance Plans, an in­dus­try trade group, did not dis­pute the ben­e­fits of clear de­scrip­tions but warned that they will add one more bur­den to a health­care sys­tem al­ready strug­gling to con­tain costs.

“The ben­e­fits of pro­vid­ing a new sum­mary of cov­er­age doc­u­ment must be bal­anced against the in­creased ad­min­is­tra­tive bur­den and higher costs to con­sumers and em­ploy­ers,” AHIP spokesman Robert Zirkel­bach said in a writ­ten state­ment.

For ex­am­ple, he noted, it will prob­a­bly re­quire most large em­ploy­ers that cus­tomize the ben­e­fit pack­ages they pro­vide to their em­ploy­ees to cre­ate tens of thou­sands of ver­sions of the new doc­u­ment. The prac­ti­cal ef­fect would add ad­min­is­tra­tive costs “with­out mean­ing­fully help­ing em­ploy­ees” be­cause sim­i­lar in­for­ma­tion al­ready is pro­vided.

The in­sur­ers’ ob­jec­tions were echoed by He­len Dar­ling, pres­i­dent and CEO of the Na­tional Busi­ness Group on Health, a not­for-profit rep­re­sen­ta­tive of the na­tion’s largest em­ploy­ers, which in­sure more than 50 mil­lion work­ers. “It’s go­ing to be very hard and prob­a­bly costly,” Dar­ling said in an in­ter­view.

Com­pa­nies will prob­a­bly have to spend “mil­lions of dol­lars” to meet the new stan­dards that few em­ploy­ees may even no­tice, she said. Her mem­ber com­pa­nies al­ready pro­vide de­tailed and up­dated in­for­ma­tion on their in­surance of­fer­ings ev­ery year dur­ing open en­roll­ment pe­ri­ods, but the spe­cific de­sign of the fed­eral re­quire­ments will ne­ces­si­tate ma­jor changes.

“I don’t think the av­er­age Amer­i­can pays that much at­ten­tion to this,” Dar­ling said. “As ben­e­fits peo­ple, we wish they did; we can’t even get them to open their ben­e­fits pack­ets.”

Self-in­sured com­pa­nies will likely face sim­i­lar re­quire­ments un­der ex­pected mod­i­fi­ca­tions to the pro­posed rules, said Daniel Maguire, di­rec­tor of the Of­fice of Health Plan Stan­dards and Com­pli­ance As­sis­tance at the La­bor De­part­ment.

The over­all cost of the new re­quire­ment re­mains un­known, ac­cord­ing to CMS of­fi­cials and the Na­tional As­so­ci­a­tion of In­surance Com­mis­sion­ers, which rec­om­mended the spe­cific de­sign and re­quire­ments in­cluded in the pro­posed rule.

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