Essential Health Benefits: What Does the CHIP Experience Show Us?

So my previous blog on this topic talked about how the CHIP/Essential Health Benefits analogy has its limits – still it is interesting to look at the choices that states have made for their benefits packages in separate state CHIP programs.

According to data collected and released by NASHP from mid-2008, the most popular choice by states was to use “Secretary approved coverage” – an option that would not be available under EHB.

Eighteen out of 40 states picked this option. Most states were using this option to provide a Medicaid look-alike package so as to simplify coordination between the two programs – an interesting finding. The second choice was to base CHIP benefits on state employee coverage – again, something with which states are familiar. Only one state has selected the federal employees benefit option – suggesting that few states will pick up this option in EHB.

Four states selected benchmark equivalent coverage.  In two of those states,  South Carolina and Utah,  the benchmark was tied to their state employee coverage and in the other two, Indiana and Wisconsin, the benchmark was tied to the largest commercial HMO.

So a bit of a hodgepodge but it seems to me that the CHIP experience suggests that few states will choose the FEHBP option and are more likely to choose an option that promotes coordination with other aspects of their state coverage picture. This could mean that many states will choose the small group option (so as to have continuity inside and outside of the exchange) or the state employee option.

This is the third in Say Ahhh’s blog series on essential health benefits.

Joan Alker
Joan Alker is the Executive Director of the Center for Children and Families