Obama Administration Issues Key Proposed Rules on ACA Implementation

Wed November 21, 2012

(Washington, D.C.) - The Obama Administration this morning issued proposed rules implementing key provisions in the Affordable Care Act barring insurance companies from discriminating against those with pre-existing conditions, and establishing standards for essential health benefits (EHB).  In a related development, the Administration issued a guidance letter on Medicaid benchmark benefit coverage options.

A very preliminary review of the new proposed rules indicates that the Administration has:

·        Given states an additional 30 days (until the comment period closes) to choose an EHB plan or to revise their previous EHB plan selection;

·        Expressly required states’ EHB to comply with the Mental Healthy Parity and Addiction Equity Act of 2008 (MHPAEA);

·        Required EHB plans to offer 10 health service categories including mental health and substance use disorder services as required under the Affordable Care Act;

·        Required states whose EHBs are deficient in one or more health services categories to supplement their EHBs with services offered in an HHS-approved ACA-compliant benchmark plan; and,

·        Tasked NCQA and URAC as the accrediting bodies for state insurance exchange plans.

Over the next few days, we will be analyzing the new proposed rules and providing you with additional information.  It is important to keep in mind that the EHB standards are a federal floor.  As a result, state plans may vary from the standards in the federal rule, and will most likely require individual analysis.  APA has already developed a web page specific to state health insurance exchanges that can be reached via: /statehealthexchanges

The two major rules issued this morning are:

  • A proposed rule that, beginning in 2014, prohibits health insurance companies from discriminating against individuals because of a pre-existing or chronic condition.  Under the rule, insurance companies would be allowed to vary premiums within limits, only based on age, tobacco use, family size, and geography. Health insurance companies would be prohibited from denying coverage to any American because of a pre-existing condition or from charging higher premiums to certain enrollees because of their current or past health problems, gender, occupation, and small employer size or industry. The rule would ensure that people for whom coverage would otherwise be unaffordable, and young adults, have access to a catastrophic coverage plan in the individual market. For more information regarding this rule, visit: http://www.healthcare.gov/news/factsheets/2012/11/market-reforms11202012a.html;

  • A proposed rule outlining policies and standards for coverage of essential health benefits, while giving states more flexibility to implement the Affordable Care Act. Essential health benefits are a core set of benefits that would give consumers a consistent way to compare health plans in the individual and small group markets. A companion letter on the flexibility in implementing the essential health benefits in Medicaid was also sent to states. For more information regarding this rule, visit http://www.healthcare.gov/news/factsheets/2012/11/ehb11202012a.html

In addition to the two proposed rules as described above, the Administration has also issued a guidance letter to State Medicaid Directors on their Medicaid benchmark benefit coverage options.  The Medicaid guidance can be found at:


For the full text of the APA memo, please click here.

For more information about state health exchanges, please click here.

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