What is the difference between minimum essential coverage versus essential health benefits?

Asked August 26, 2013, 11:48 AM EDT

What is the difference between minimum essential coverage vs essential health benefits?


2 Responses

Good question, as these terms sound similar. However, minimum essential coverage and essential health benefits are describing two different things. The term “essential” is used with both as a way to indicate that these are important criteria that everyone should have or have access access to, according to the new health care law (called the Affordable Care Act, or ACA).

Minimum essential coverage refers to the minimum health insurance coverage everyone needs to have, kind of like how most states have a minimum level of car insurance all drivers need to have. Starting in 2014, the individual shared responsibility provisions of the ACA (also called the individual mandate) calls for each individual to have this minimum essential health insurance coverage, qualify for an exemption, or make a shared responsibility payment when filing a federal income tax return. If you're covered by any of the following in 2014, you're considered covered and don't have to pay a penalty:
Any Marketplace plan, or any individual insurance plan you already have; any employer plan (including COBRA), with or without “grandfathered” status (this includes retiree plans); Medicare; Medicaid; The Children's Health Insurance Program (CHIP); TRICARE (for veterans and veteran families); Veterans health care programs (including the Veterans Health Care Program, VA Civilian Health and Medical Program (CHAMPVA), and Spina Bifida Health Care Benefits Program); and Peace Corps Volunteer plans. Additionally, other plans may also qualify, and you can ask your health coverage provider for more information.

Essential health benefits refers to what types of services health insurance plans need to cover. The ACA outlines 10 categories of services as essential health benefits that are required, and this list is below. This means that these are benefits that health insurance plans must provide, with the exception of “Grandfathered Plans,” catastrophic plans for those under 30, or self-insured plans (or “self-funded” plans as they are also called).

10 essential health benefits:·

  • Pregnancy, labor, delivery and newborn care (before and after baby’s birth
  • Emergency services
  • Hospital stays
  • Mental health and substance use disorder services
  • Prescription drugs
  • Rehab services and medical devices (e.g., physical or speech therapy)
  • Laboratory services (e.g., blood tests)
  • Prevention and wellness services
  • Chronic disease management (e.g., diabetes, asthma)
  • Children’s dental and vision care

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