By John Reichard, CQ HealthBeat Editor
May 24, 2012 -- Starting in September, 173 million Americans will get an easy-to-understand summary of the benefits and out-of-pocket costs of their health plans, says a report Families USA recently released.
Mandated under a summary of benefits requirement in the health care law (PL 111-148, PL 111-152), the summaries may give the controversial law a bit of a boost in the eyes of a skeptical public. Insurer and employer groups lobbied hard to delay the eight-page explanations, saying they were too difficult to put together on time in an accurate way. But the Obama administration refused to postpone the release.
The summary requirement is likely to survive if the Supreme Court ruling on the constitutionality of the 2010 law stops short of fully striking it down.
"Health plans clearly win the prize for being the most difficult major product for families to compare," said Ron Pollack, Families USA executive director. Policies "read like gobbledygook," he said.
Even people with advanced degrees don't really understand the policies they have, he said. "Most people don't even read them."
Consumers Union analyst Lynn Quincy said at a news briefing that test show the summary "really helps consumers."
"This is a new tool that consumers have not really seen before" and for the first time, thanks to the standardized format, people "can compare plans side by side on an apples to apples basis," she said. A part of the summary that lists what services a plan excludes from coverage was "extremely helpful" to people buying insurance, she said.
The consumer advocates said that the summaries will be particularly helpful to those who have a choice of health plans. Nearly 19 million Americans who buy coverage on the individual market will find it easier to make a choice, as will about 71 million Americans employed by companies that offer more than one plan, the report said.
Among the features of the summaries are "coverage fact labels" that tell the consumer how much they can expect to pay and how much they can expect the plan to pay in common health care scenarios—the rule specifies maternity and type 2 diabetes.
Advocates for diabetes patients say the feature will be particularly helpful to that patient population.
Pollack noted that summaries must give consumers other information they often have difficulty finding, such as what prescription drugs the plan covers, which providers participate, and the rights of enrollees to appeal health plan decisions.
But employer representatives have said that the required examples of costs for a particular type of ailment would be misleading because out-of-pocket costs for complex diseases vary widely from patient to patient and also by geography. They add that plans with "tiered" networks that have varying out-of-pocket charges can't be listed in the format. Consumers will be confused and angry when they end up paying something different than what is listed in the summary, critics say.
But Washington and Lee University Law Professor Timothy Jost pointed out in a recent blog in Health Affairs that the summary requirement, along with rebates to be sent to consumers this summer if their plans pay out too little for health care, is a priority for the Obama administration.
The rebates and the summaries "will be the first concrete experience that millions of Americans will have" with the health law, Jost blogged. "The administration continues to work toward ensuring that this experience in fact occurs, and that it will be a positive one."