15.1 ACA Essential Health Benefits and Metal Levels
Key Takeaways
- Non-grandfathered individual and small-group plans must cover ten Essential Health Benefit categories with no annual or lifetime dollar limits on EHBs.
- Pediatric dental and vision are EHBs; adult dental and adult vision are not.
- Metal levels reflect actuarial value: Bronze 60%, Silver 70%, Gold 80%, Platinum 90% (±2% de minimis).
- Higher metal levels mean higher premiums but lower point-of-care cost-sharing; all tiers cover identical EHBs.
- Catastrophic plans are limited to under-30s or hardship-exempt enrollees and cannot use premium tax credits.
Essential Health Benefits (EHBs)
The Affordable Care Act (ACA), signed March 23, 2010, requires every non-grandfathered individual and small-group plan to cover a federally defined package of Essential Health Benefits (EHBs). A plan cannot impose annual or lifetime dollar limits on these EHB categories, and out-of-pocket costs for in-network EHBs count toward the plan's annual maximum-out-of-pocket (MOOP) limit.
The ACA names ten EHB categories. Memorize them; exam items frequently ask which listed service is not an EHB (cosmetic surgery, adult dental/vision, and long-term custodial care are common distractors).
The Ten Essential Health Benefit Categories
| # | Category | Note |
|---|---|---|
| 1 | Ambulatory (outpatient) services | Care without hospital admission |
| 2 | Emergency services | No prior authorization; no higher cost-share out-of-network |
| 3 | Hospitalization | Surgery, overnight stays |
| 4 | Maternity and newborn care | Cannot be excluded as pre-existing |
| 5 | Mental health and substance-use disorder services | Includes behavioral health; parity applies |
| 6 | Prescription drugs | At least one drug per category/class |
| 7 | Rehabilitative and habilitative services and devices | Therapy, durable medical equipment |
| 8 | Laboratory services | Diagnostic testing |
| 9 | Preventive/wellness services and chronic-disease management | Graded screenings at $0 cost-share |
| 10 | Pediatric services, including oral and vision | Pediatric dental/vision required; adult dental/vision are not EHBs |
Trap: Pediatric dental and vision are EHBs, but adult dental and adult vision are not. Routine preventive services rated 'A' or 'B' by the USPSTF, plus recommended immunizations and women's preventive services, must be covered at zero cost-share when delivered in-network — no deductible, copay, or coinsurance.
Metal Levels and Actuarial Value
Qualified Health Plans (QHPs) on the Marketplace are grouped into four 'metal' tiers defined by actuarial value (AV) — the percentage of total covered medical costs the plan is expected to pay for a standard population. AV measures plan generosity, not the share any one enrollee pays in a given year.
| Metal level | Actuarial value (plan pays) | Member pays (approx.) |
|---|---|---|
| Bronze | 60% | 40% |
| Silver | 70% | 30% |
| Gold | 80% | 20% |
| Platinum | 90% | 10% |
A de minimis variation (generally ±2 percentage points) is allowed around each target. Higher metal levels carry higher premiums but lower cost-sharing (deductibles, copays, coinsurance) at the point of care. The metal a person chooses does not change the EHB package — all tiers cover the same ten categories.
Catastrophic Plans and the MOOP
A catastrophic plan is a separate option, not a metal level. It is limited to people under age 30 or those with a hardship/affordability exemption. It carries very low premiums, a high deductible equal to the annual MOOP, and covers EHBs plus at least three primary-care visits per year and ACA preventive services before the deductible. Premium tax credits cannot be used for a catastrophic plan.
The federally indexed annual MOOP caps total in-network EHB cost-sharing. Once an enrollee reaches the MOOP, the plan pays 100% of further in-network EHB costs for the year. Premiums never count toward the MOOP; out-of-network charges and non-EHB services generally do not count either.
Grandfathered Plans and the Reach of the EHB Mandate
The EHB and metal-level rules do not reach every policy in force. A grandfathered plan is individual or group coverage that existed on March 23, 2010, and has not made significant cost-shifting changes since. Grandfathered plans keep certain pre-ACA features and are not required to cover the full EHB package or fit the metal tiers, although they must honor some reforms (for example, no lifetime limits on covered benefits, and dependent coverage to age 26).
The full EHB requirement applies to non-grandfathered individual and small-group plans. Large-group and self-insured employer plans are not bound by the EHB package itself, but they cannot impose annual or lifetime dollar limits on whatever EHBs they do choose to cover. This distinction is a frequent exam point: do not assume every health plan in the country must cover all ten categories.
Why the EHB Floor Matters to Producers
Because EHBs set a uniform coverage floor, plan comparison shifts away from 'what is covered' toward how much the enrollee pays — premiums, the deductible, copays, coinsurance, and the network. A producer should steer a healthy, low-utilization client toward a Bronze plan (low premium, high cost-sharing) and a client with chronic conditions or expected high use toward Gold or Platinum (higher premium, lower out-of-pocket).
Remember the building blocks of cost-sharing. The deductible is paid first by the member before most benefits begin. Copays are flat per-service dollar amounts. Coinsurance is a percentage the member pays after the deductible. All in-network EHB cost-sharing accumulates toward the MOOP, after which the plan pays 100%. Mastering these terms lets you explain why two plans with identical premiums can leave very different out-of-pocket exposure.
Which of the following is NOT one of the ten Essential Health Benefit categories required by the ACA?
A Gold-level Qualified Health Plan has an actuarial value of 80%. What does that figure mean?
Actuarial Value Targets by Metal Tier
The metal levels describe actuarial value (AV) — the share of total covered costs the plan pays for a standard population — not the share any one person pays. Memorize the four target AVs and the principle that a richer AV means higher premium, lower cost-sharing.
| Metal level | Plan pays (AV) | Enrollee pays |
|---|---|---|
| Bronze | ~60% | ~40% |
| Silver | ~70% | ~30% |
| Gold | ~80% | ~20% |
| Platinum | ~90% | ~10% |
A common trap: a Bronze plan does not mean the insured pays 40% of every bill — it means that, across a standard population, the plan covers about 60% of aggregate costs. Cost-sharing reductions (next section) only attach to Silver plans.
Preventive Care and Annual Limit Bans
Two ACA mandates the exam tests alongside EHBs: in-network preventive services (immunizations, screenings, well-visits) must be covered at no cost-sharing, and plans may not impose lifetime or annual dollar limits on EHBs. These bans, combined with the EHB floor, are why post-ACA major medical cannot resemble the capped, exclusion-heavy individual policies sold before 2014.