By Anna Stelter, LMSW, MPH
The American Health Care Act (AHCA), the first major Trump administration attempt to repeal and replace Obamacare, died in the House of Representatives last Friday. Much of the postmortem surrounding the bill’s failure has focused on which ideological factions it ultimately could not satisfy, with plenty of fingers pointed between moderate Republicans, the conservative Freedom Caucus, the President, and House Speaker Paul Ryan.
Republicans’ struggle to satisfy both their center-right and far-right voting blocs speaks to what can happen when bold campaign promises collide with health policy details. Perhaps no single sticking point of AHCA illustrated this tension more clearly than the one many believe ultimately sunk the bill: the fight to scrap Obamacare’s ten essential health benefits.
What are the 10 Essential Health Benefits?
The Affordable Care Act (ACA) requires all health insurance plans to cover ten types of health services, which it calls Essential Health Benefits (EHBs) [see image]. Before ACA, health plans commonly covered only a handful of these services, exposing consumers to financial and medical risk. Sick patients frequently discovered that medical care for their condition was covered, but drugs or equipment needed to manage their condition were not. Expectant moms were rarely covered for maternity care, and mental health and substance use coverage was the exception rather than the rule. For these reasons, the ACA’s essential health benefits were recognized as a landmark consumer protection, guaranteeing that insurers could no longer sell plans too skimpy to provide meaningful coverage.
Why are EHBs Contentious?
ACA’s Republican opponents have criticized burdensome regulations on insurers and skyrocketing premiums under ACA, and blame EHBs as a key bug in the law. And they do have a point: the more providers and products in a plan, the more expensive that plan becomes for the insurance company to build and administer. When ACA required insurers to cover more services, costs ballooned.
Republicans have suggested that repealing EHBs would lower premiums by allowing individuals to buy coverage for “only what they need,” and conversely, keep people from having to pay for benefits they would never use. In other words, if people want to buy skimpy coverage and pay less for it, the GOP says they should be able to do that. And if men don’t want to pay for mammograms or a childless older adult does not want to pay for pediatrics, the GOP argues they shouldn’t have to do that, either. The free market appeal of these two mirror image goals is undeniable.
So, what about EHBs proved so contentious that 216 Republicans could not reach agreement? And why couldn't the Republicans have simply gotten rid of EHBs if it would have secured the last few votes they needed to pass AHCA? We don't know whether moderates would have remained in support if EHBs were rescinded, but what we do know is the GOP’s free-market health care message ran into the buzz saw of policy reality when EHB repeal was suggested, and it proved a fatal error.
Essential Health Benefits are More than Just a Consumer Protection
The impact of EHBs in keeping bad insurance plans off the market cannot be overstated, and is a reason they are popular among consumers. However, beyond simply being popular, EHBs are essential to the law's function. Without them, the insurance market would deteriorate rapidly.
It turns out there is a crucial relationship between EHBs and another of ACA’s regulations -- the ban on insurers denying people with pre-existing conditions -- that is not obvious to the naked eye. And if EHBs were to be eliminated, the pre-existing condition regulation would become a major problem. The reason is as follows:
Contrast this to Speaker Ryan's free market vision that repealing EHBs would suddenly make a spectrum of plan offerings available: bare-bones coverage for those who want it, comprehensive plans for those willing to pay more. Upon further inspection, it is clear that as long as no one can be denied for a pre-existing condition, achieving this vision by removing EHBs is an impossibility. Notably, a handful of Freedom Caucus members appeared to suggest also removing ACA’s pre-existing condition regulation to solve this issue, an idea likely too toxic even for some within that voting bloc, and clearly at odds with what the President has promised.
In any future attempt at health reform, EHBs are likely to resurface as a point of contention. Although AHCA has met its Waterloo, the past week’s negotiations around EHBs may serve as a cautionary tale: remove them at your own peril.
Will Francis, LMSW
Government Relations Director,
National Association of Social Workers,
Cossy Hough, LCSW
Clinical Assistant Professor, The University of Texas at Austin,
School of Social Work
Anna Stelter, LMSW, MPH
Health Policy Analyst
Texas Health Institute
Alison Mohr Boleware, MSSW
Mental Health Policy,