In 2014, health plans offered in the individual and group insurance markets will be required to cover a comprehensive set of benefits that fall into 10 categories – the essential health benefits (EHB) package. These EHBs include habilitative services and devices, a set of benefits not traditionally covered by private health insurance. Habilitative services, like rehabilitative services, generally include occupational and physical therapy, as well as speech-language services. However, unlike rehabilitative services, which aim to recover capacities lost, habilitative services help people acquire, maintain, or improve skills and functioning for daily living. For individuals with intellectual or physical disabilities, the inclusion of habilitative services in the EHB package marks an important step toward coverage that better meets their needs.
Last September, 28 states and the District of Columbia submitted their EHB benchmark plan selections—a plan whose benefits will help define EHB for the state. Then, in November, HHS issued an interim final rule for the EHBs, which recognized that many health plans across the country do not recognize habilitative services as a distinct group of services. The rule proposed a flexible policy that allows states to define habilitative services if their benchmark plan fails to do so. The rule proposes that if states choose not to define habilitative services, health plan issuers either provide habilitative services in parity with rehabilitative services or provide to HHS a list of selected habilitative services they will cover.
States are taking on this challenging question of defining habilitative services as they continue to determine their essential health benefit (EHB) benchmark plans. This issue has been of particular interest to State Refor(u)m users, and several states have shared their definitions developed in response to the rule which are highlighted below
- California: Through a multi-stakeholder collaboration, the state has defined habilitative benefits in state law to be:
“medically necessary health care services and health care devices that assist an individual in partially or fully acquiring or improving skills and functioning and that are necessary to address a health condition, to the maximum extent practical. These services address the skills and abilities needed for functioning in interaction with an individual's environment.”
The state has specified that services including respite care, day care, recreational care, residential treatment, social services, custodial care, or education services of any kind do not qualify as habilitative. Through A.B. 1453, which was enacted in September, California will require plans to cover habilitative services in parity with rehabilitative services.
- Colorado: After a lengthy stakeholder engagement process, the state defined habilitative services as “services that help a person retain, learn or improve skills and functioning for daily living that are offered in parity with, and in addition to, any rehabilitative services offered in Colorado’s EHB benchmark plan.” The state will require habilitative services to be offered in “like type and substantially equivalent in scope, amount and duration” to rehabilitative services.
- Kansas: In its comment letter to HHS on the final interim rule, the state specified that because its EHB benchmark has well-defined rehabilitative services, it recommends participating plans offer habilitative services in parity with them. Kansas believes this will ensure consistency across plans offered in the state.
- Rhode Island: The state has developed a detailed checklist that outlines the state’s expectations for how plan issuers will comply with federal and state regulations. The state will allow plans to define habilitative benefits, but will require them to be defined in scope, and they must be at least as comprehensive as rehabilitation benefits (measured by per member per month cost). The state will only allow benefit limitations if an issuer can demonstrate that evidence-based limitations will be less burdensome to the consumer. After each calendar year, the state will require plan issuers to submit actuarial analyses of claims and expense data related to habilitative and rehabilitative services.
- Ohio: In a letter to CCIIO, Governor John Kasich asserted that the default benchmark plan selected for Ohio does not include habilitative benefits. According to the letter, Ohio will allow health plans to determine habilitative service benefits. However, the Governor specified that Ohio will require plans to cover habilitative services for children age 0 to 21 diagnosed with Autism Spectrum disorder including both out-patient physical rehabilitation services and mental/behavioral health services.
Has your state been thinking about how to define habilitative services?* Do you have a different or similar approach to the states discussed? Let us know the details in a comment below.