Have questions about your health plan? Soon all you’ll have to do is check a label.
The Affordable Care Act requires that health insurance providers make “coverage facts labels” available so that consumers can clearly understand what they’re getting with their health plan. It will have pricing information to compare health insurance policies.
But it’s not as simple as your typical label—the health insurance label will be at least two pages long. A new summary of benefits form, which insurers will use to explain what services their policies cover, is also required.
Last week, the group working to draft the overage labels agreed to seek public comment on the drafts and conduct consumer focus testing for additional feedback before presenting them to state insurance commissioners. The health care bill had directed the National Association of Insurance Commissioners to draft them, but the association gave that job to a working group made up of state insurance regulators, industry representatives and consumer advocates.
Once approved, the labels will be sent to federal officials who will consider implementing them for insurance companies. The labels and benefit summaries are supposed to take effect next year.
To begin with, three medical scenarios will be listed on coverage labels: maternity care, treatment for diabetes and breast cancer.
Because medical costs vary widely across the country and among providers, and the treatment regimen may also depend on individual providers, the working group opted to use national average prices for the standard treatment regimen on the labels. The labels then break down how a policy would apportion those costs.
For the breast cancer example, insurers will have to list how much patients would pay – based on the national average price—for everything from surgery, lab tests, office visits, chemotherapy and radiation treatment to prescription drugs, a wig and mental health counseling. If a plan offers no maternity coverage, the label will show that the patient is responsible for paying the entire cost.
The labels are supposed to make it easy for consumers, but it’s not that easy for the group drafting the labels.
“We want there to be as much information in the hands of consumers as possible,” Susan Pisano, told Kaiser Health News. But Pisano, a spokeswoman for America’s Health Insurance Plans, an industry group that will be conducting consumer focus group testing later this month, also said they “want to make sure that the information is valuable from their perspective.”
A big concern is that labels may be confusing to consumers by providing cost examples that will vary significantly from their actual costs. Since the labels will be produced based on information provided by HHS, they won't indicate differences in cost sharing “due to variation in the insurer’s contracted rates with physicians and hospitals, cost differentials due to geographic variation, variation in policies used to reimburse providers and insurer programs to help consumers manage their medical condition and treatment,” according to a letter sent by Joy Higa of UnitedHealth Group to the NAIC.
Additionally, there is still a lot of information and the group must be careful about the language they chose.
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