As outlined in our comments submitted to the Institute of Medicine (IOM) on December 6, 2010, WellPoint believes that when determining what benefits are essential, it will be imperative to balance the need for comprehensive, evidence-based coverage with the need to ensure access to affordable coverage for consumers. If “essential” is defined too broadly, such as by including benefits without a sound evidence base or items that are currently not included in many individual or employer benefit packages, consumers’ access to affordable coverage will be compromised.
In order to better understand what benefits should be considered essential, WellPoint has undertaken a process to evaluate our fully-insured, small group market (where a small group is defined as one with 1 or 2 to 50 employees) product offerings across the country to identify where there is consistency across our products, where there might be differences, and the cost impacts of these differences. The attached exhibits illustrate our findings. As you will see, there is little variation in our typical small group plans within and across states. However, the cost impact of those benefits that vary can be substantial, especially when taken in sum. We share this information in the hopes that it may be helpful as the IOM makes its recommendations to the Department of Health and Human Services regarding the determination of essential health benefits.
Large Group Benefits
Plans offered in the small group market are standardized and provide little or no flexibility to add or remove coverage for services. These standard plans are offered in all markets, small, mid-size and large, but large groups (those with over 100 employees) have the flexibility to customize their plans. Thus, because large groups also start with the same standard product portfolios in each state as offered to small groups, large group products generally cover the same services as the small group products in any given state. The level of flexibility a large group has to customize their benefits is determined by funding type (fully-insured versus self-insured) and the size of the account. For example, a 150 life fully-insured group has less flexibility to customize benefits than a 1,000 life self-insured group.
Most customization for large groups is around benefit cost share or benefit limits, not coverage/exclusions. Less than 5% of customization requests deal with adding coverage. Examples include requests to add coverage for specific non-covered prescription drugs or over-the-counter medications (majority), coverage for hearing aids, coverage for bariatric surgery, and coverage for infertility. Very few (only about 2%) of the large group customization requests are to remove coverage, and most of these are self-insured groups requesting to remove state mandated coverage (as such mandates generally apply only to fully-insured products).
Helpful Definitions for Exhibit A
• “Anthem/Blue Standard Coverage/Typical SG Plans” cover a standard set of medically necessary services including inpatient and outpatient hospital services, diagnostic services, physician visits and medical care, maternity care, surgical services, mental health and substance abuse services, therapy services, skilled nursing facility services, home health care services, preventive care services, and medical equipment and supplies. For more details on inclusions and exclusions to the standard plan, please see Exhibits B and C, respectively.
Most variation across these standard plans is driven by differences in cost-sharing, not covered services.