Similar health reform terms, but very different concepts

Essential health benefits include maternity and newborn care.

Photo: David Castillo Dominici via 
Essential health benefits include maternity and newborn care.

We’ve had a few members wonder whether “essential coverage” and “essential benefits” are one and the same.

They aren’t – and we’ve done a tip sheet to explain the difference in more detail.

But here’s the quick version:

If someone has minimum essential coverage it means he or she has a health plan that complies with the individual mandate. It means that there will be no penalty when 2014 taxes are filed. A lot of health plans qualify, including the exchange plans, most plans in the individual and small group market, employer-based health plans, Medicare, Medicaid.

Limited plans such as workers’ compensation or dental-only plans do not qualify as mandate-meeting minimum essential coverage.

Essential health benefits are the 10 categories of benefit s – hospitalization, prescription drugs, maternity care, etc. – that the exchange plans and the ACA-compliant off-exchange plans must cover. (After the brouhaha about plan cancellations, the administration gave states the option of extending the noncompliant plans for a few more years. They can be minimum essential coverage – but they don’t have essential health benefits.)

See the tip sheet for more explanation.

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