Essential Health Benefits

What you heard:

Paul Ryan et al. tried to get the Freedom Caucus on board with the AHCA by eliminating Essential Health Benefits.

What it is:

Paul Ryan (R-WI) is currently the Speaker of the House; he’s served in Congress since 1999 as a member of Wisconsin’s delegation (unfortunate home-state shout-out to you, Wisco). You may remember him as Mitt Romney’s running mate in 2012. Until recently, he enjoyed a reputation as the House GOP’s golden boy “policy wonk” – and has apparently been dreaming of taking away old & poor people’s Medicaid since college. Lovely.

Since this is America, where we can only wish Paul Ryan’s Medicaid obsesh was the worst of our worries, the Freedom Caucus not only exists, but also actively influences US policy. They are a group of House members who ascribe to ultra-conservative ideas; they shut down the government over the funding of Planned Parenthood and ran John Boehner out of town. The group refuses to disclose the names of members (*rolls eyes bigly*), but best guesses are in the 30-35 range. White guys. You know the drill.

Unless you’ve been under a rock these past 18 days, you’ve heard quite a bit about the AHCA. Massive tax cut for rich people disguised as “health care reform”. Would result in higher premiums, shittier coverage, and 24 million more people uninsured by 2026. Slammed through House. Was nearly voted on a few times before being ultimately pulled last Friday.

What we’re here to talk about today, though, are Essential Health Benefits (EHBs). These are 10 services that insurance providers are required to cover under the ACA. Per, they are:

  • Ambulatory patient services (outpatient care you get without being admitted to a hospital)
  • Emergency services
  • Hospitalization (like surgery and overnight stays)
  • Pregnancy, maternity, and newborn care (both before and after birth)
  • Mental health and substance use disorder services, including behavioral health treatment (this includes counseling and psychotherapy)
  • Prescription drugs
  • Rehabilitative and habilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills)
  • Laboratory services
  • Preventive and wellness services and chronic disease management
  • Pediatric services, including oral and vision care (but adult dental and vision coverage aren’t essential health benefits)

The inclusion of these EHBs is important because, before the ACA, if you were trying to buy insurance on the marketplace, often you couldn’t even find insurers to cover these services. Work a job that doesn’t offer insurance but have chronic health issues? Get ready to pay out of pocket for insanely expensive pharmaceuticals. Lose your job after Republican deregulation of banks tanked the economy? Good luck paying $100k to birth that baby you’re pregnant with. Even when the coverage was offered, it was often in incredibly expensive plans that working-class or unemployed people couldn’t afford.

What it means:

Basically, Paul Ryan was trying to bribe hardline conservatives by even further loosening requirements on insurers – a loosening that would only hurt older, sicker people (more on that below). The Congressional Budget Office determined that it would actually cost more money to remove EHBs and would still result in those 24 million people losing insurance. Somehow, the GOP managed to come up with a lose-lose situation that was bad policy-wise and PR-wise (see: picture of all those white men discussing how best to make sure insurers didn’t have to cover pregnancy). ALSO, since removing EHBs wasn’t budget-related (why they didn’t include the removal provision in the first place), it’s unlikely that it even would have been able to be included with this “budget reconciliation” bill. In sum, the removal of EHBs was:

  • More expensive
  • Not better for Americans
  • Probably illegal

#makeamericagreatagain, my butthole.

What could happen:

Thankfully, we all know what actually did happen: the AHCA was pulled and we all could breathe a little easier and call our weekend drinking “celebratory” instead of “coping”. However, in case this little issue comes up again, here’s what could happen if the GOP-controlled Congress ever gets its act together and manages to pass a healthcare law that removes the EHBs requirement.

In a race to the bottom, insurers offer more and more cut-rate plans – and fewer and fewer comprehensive ones. This is why it was so hard to find comprehensive plans before the ACA required EHBs be covered. If you are an insurance company, you want to attract young, healthy people, because they pay in but do not often need to draw out of the pool. So you make your low-price plans competitive to attract these people. BUT, if you offer a plan that offers more comprehensive coverage (say, of maternity care), most likely the only people buying your insurance will be the ones who foresee using it (women interested in giving birth). So, your pool isn’t that profitable, because the only people who are paying in are also drawing out at high amounts. Why offer plans that are going to make you less money?

Then, insurance gets more expensive for women, older people, and those with chronic illness. If insurers are not required to include maternity care in their insurance plans, women will have to seek out plans that do – and there’s no doubt those plans will be much more costly. Same for older people, who have higher prescription costs. Same for those with chronic illness, who often depend on physical or mental therapy as well as prescription drugs. When plans get more expensive, fewer people can afford them. When fewer people buy into your pool, you have to raise prices even more to break even. Around and around we go.

This, my friends, is what’s known as a “death spiral”. And that’s why EHBs are so important.

3 thoughts on “Essential Health Benefits

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