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Essential Health Benefits

The Top Ten Benefits Required by Obamacare


essential health benefits

All plan on the exchanges must provide 10 essential health benefits.

Photo: David McNew / Getty Images

You can purchase or change medical coverage on the health insurance exchanges, which opened in most states on October 1, 2013. All plans listed are required to cover services in each of the ten Essential Health Benefits categories. This mandate applies to all plans created after March 23, 2010, when the Affordable Care Act was signed. 

 If you had your plan before then, it may be grandfathered in, and not have the required benefits. However, many insurance companies are dropping these plans, and asking you to switch to plans that do provide this coverage on the exchanges. For more, see When Does Obamacare Start?

Therefore, it's worth it to review these benefits, and compare them to the benefits your plan currently provides you. Less than 2% of plans carried all ten benefits. You may find you can get a better plan for less money under Obamacare. The premiums may be higher, but the overall coverage may wind up costing you less. Find out How to Get Obamacare.

This is especially true if your household income is less than $45,960 ($94,200 for a family of four). Those with incomes at this level or less will receive a Federal government subsidy that can cover part, or even all, of the premium cost. For more, see How Does Obamacare Work?

Obamacare allows each state to create its own "benchmark" plan that will be the model for all other plans in its jurisdiction. That's to make sure the plan is not too expensive for small businesses to offer. The plans must cover the state's benchmark services without imposing a lifetime maximum, or annual limit, on costs. For more, see CIGNA, Essential Health Benefits.

Here's the ten benefit categories:

  1. Outpatient Care - Most health insurance plans cover this already.
  2. Emergency Room Services - Most plans cover this, but may charge extra if you go to a hospital that's out of their network, or go without pre-authorization. Obamacare plans don't charge extra.
  3. Hospitalization - Not all plans cover enough of this huge cost. Most people don't realize that a day in the hospital can cost between $2,000 - $20,000 a day. If you have a high-deductible plan, or a plan with a low maximum, you may be surprised by how much you wind up paying out-of-pocket. Hospitalization costs are one reason that health care is the #1 cause of bankruptcy.
  4. Preventive and wellness visits, as well as chronic disease management - Preventive care visits have no copay. Obamacare requires that all 50 procedures recommended by the U.S. Preventive Services Task Force be covered as preventive services. These include well-woman visits, domestic violence screening, and support for breastfeeding equipment and contraception. For more, see Preventive Care Provision.
  5. Maternity and Newborn Care - Maternity care is categorized as preventive care, and must be provided without cost. Most young people who don't have insurance will find this is a needed benefit if they become pregnant.
  6. Mental and Behavioral Health Treatment - This includes treatment for alcohol, drug and other substance abuse and addiction. Patient co-pays could be as high as $40 a session, and the number of therapist visits could be limited.
  7. Prescription drugs - Most plans offer this at a cost. All plans listed on the exchanges will include coverage of at least one drug in every category in the U.S. Pharmacopeia. Whatever you pay out-of-pocket for drugs will also count toward your deductible, which is not true for all insurance plans now.
  8. Services and devices to help people with injuries, disabilities, or chronic conditions - Most plans cover services and equipment to help you recover from temporary injuries, like a broken leg. Obamacare plans will also cover goods and services to help you maintain a standard of living if you contract a chronic disease, like multiple sclerosis.
  9. Lab tests - Obamacare plans cover 100% of preventive tests, but not ones ordered if you've already been diagnosed with a disease.
  10. Pediatric care - Most plans do not cover dental and vision care, which is covered by Obamacare plans. (Source: AARP, The Health Care Law's 10 Essential Benefits, September 2013)

Impact of the Ten Essential Benefits on the U.S. Economy

By setting this standard of benefits, the Affordable Care Act keeps insurers from cutting benefits to lower costs. Won't they be forced to raise premiums? Not necessarily, because their revenues will rise as millions of currently uninsured Americans start paying premiums.

Second, these mandated benefits will allow more people to find and treat chronic diseases before they require expensive emergency room visits. Millions of families will be able to avoid bankruptcy by getting treated early, or by having the insurance to cover these expenses. Over time, this should lower health care costs by reducing catastrophic care.

Third, more younger and healthier people will get insurance, thanks to the maternity, newborn and pediatric care. This will lower health insurance costs overall.

Fourth, low-income drug addicts, alcoholics and the mentally ill will have coverage to treat their conditions. Although no one can force them to get clean, sober or take their meds, preventive coverage can at least keep them from showing up every weekend in the emergency room for a chronic condition. Find out How Much Will Obamacare Cost Me? Article updated November 11, 2013

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