States Are Ignoring ACA Requirements to Cover Addiction Treatment

Insurance plans are not covering the necessary addiction services, according to a report by The National Center on Addiction and Substance Abuse. None of the 2017 Essential Health Benefit benchmark plans have adequate addiction coverage; and more than two-thirds violate the affordable Care Act (ACA). There is no penalty for states or insurance plans that don’t comply with the law. “People with addiction may not be receiving effective treatment because insurance plans aren’t covering the full range of evidence-based care. Our review did not find a single state that covers all of the approved medications used to treat opioid addiction,” said Lindsey Vuolo, JD, MPH, of The National Center on Addiction and Substance Abuse.

The ACA requires plans to cover substance use disorder services, which are under essential-health benefits. The ACA also requires these services to be provided at parity, meaning that they are comparable to medical and surgical benefits. But the ACA does not identify which specific services should be covered. Each state chooses an essential health benefit benchmark plan to determine which addiction benefits must be covered by the ACA plans sold in that state. “The absence of sufficient coverage for medication-assisted treatment for opioid addiction is particularly alarming given the number of people dying or suffering on a daily basis. This kind of health care discrimination would never be tolerated during an epidemic for any other life-threatening disease,” said Samuel Ball, PhD, President and CEO at The National Center on Addiction and Substance Abuse. The report calls on states and insurers to comply with the law and cover the full range of effective addiction treatments. The following are key findings of the report:

  • Over two-thirds of plans contain language that violates ACA requirements for addiction benefits.
  • 18% of plans don’t comply with parity requirements.
  • No plans cover the full array of critical benefits without harmful treatment limitations.
  • 88% of the plan documents are not detailed enough to evaluate parity compliance and the adequacy of addiction benefits.

More Employers Are Outsourcing Benefit Administration

One in three employers outsources all of their benefit administration, up 20% since 2013, according to a study by the Guardian. Employers are also using more vendors for support. Nearly two-thirds that outsource some benefit administration use multiple vendors, up from 48% in 2013. Employers of all sizes are realizing the need to improve efficiency; keep compliant with requirements of the ACA, FMLA, and ADA; and improve the enrollment experience. They will need to rely more on external expertise to meet their goals, according to the study.

Only half of employers say their company is very effective in tracking and managing employee leave, including FMLA, disability, and other paid-time off. Nearly two-thirds of employers outsource some aspects of the enrollment process, such as preparing enrollment materials (49%) and presenting at enrollment meetings (48%). Only 31% outsource the development of their enrollment strategy. Having a decentralized approach lessens the effectiveness of enrollment activities. It’s best to outsource enrollment strategies to integrate services that support employee decision-making, according to the study. Ray Marra, senior vice president, Group Products at Guardian said that outside expertise can help companies transform their benefit package with a broader range of employee benefits and related services. For more information, visit

New Annuity Disclosure Requirements

Older Couple Walking Along BeachGovernor Brown signed into law AB 2347 (Gonzalez), which extends important consumer protection on annuity products that are commonly marketed to seniors. The new law requires disclosure language on the front of the policy jacket or on the coversheet for an immediate annuity. This disclosure is already required for the more common deferred annuity products. Those getting immediate annuities are guaranteed a 30-day free look period.

Most Small Businesses Don’t Understand Health Reform Requirements

The majority of small business owners don’t know whether they are required to provide health insurance to employees in 2014, according to a recent survey by eHealth. Many small employers have misconceptions about what health care reform requires of them, and few are making any long-term plans based on their expectations of how health care reform might affect their businesses.

Beginning in 2014, the Patient Protection and Affordable Care Act of 2010 (ACA) requires businesses with the equivalent of 50 or more full-time employees to provide health insurance coverage for their workers. Businesses with fewer than 50 employees are exempt from this requirement, although employees may be required to purchase their own coverage.

Based on their size (fewer than 50 employees), only two of the businesses surveyed would be required by the ACA to offer health insurance coverage to employees in 2014. However, 34% believed incorrectly that they were required to buy insurance for employees in 2014 while 35% weren’t sure. Nearly 70% believed incorrectly or were not sure whether they would be required to pay a tax for not providing health insurance in 2014. Only 31% knew that the reform law does not require them to a pay tax if they don’t offer insurance. The survey also revels the following about small employers:

• 83% review company health plan benefits once a year.
• 78% don’t know how health insurance exchanges could affect their business beginning in 2014.
• 77% are not doing any long-term planning based on their expectations of how health care reform might affect their business.
• 68% have no plans to drop coverage for employees in 2014.
• 61% are most concerned about the cost and budgetary implications of health care reform.
• 59% ask their employees for input when reviewing their company’s health insurance benefits.
• 51% would consider increasing an employee’s share of premiums while 39% would consider increasing an employee’s deductible.
• 44% said it would be fair to impose penalties on employees who don’t participate in wellness programs. More than 40% of the employers that are willing to penalize employees consider the following to be acceptable: reduce the contribution to an employee’s health insurance benefits; reduce benefits like dental and vision coverage; and reduce 401k contributions, stock options, or bonuses. For more information, visit

Last Updated 01/19/2022

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