The Obama administration unveiled the basics of healthcare coverage that private insurers should meet, but are giving the states the power to decide the specifics.  Private insurance has traditionally been regulated by the states, and many are not happy when the Feds insert themselves into the equation.

As 2012 is an election year, this move is seen by some as an attempt to diffuse the furor from the right that “Uncle Sam” is forcing laws that the states can and have traditionally, taken care of.  The announcement from Health and Human Services Secretary Kathleen Sebelius gives the states leeway in response to the complaints from many.

Specifically the new proposal allows the states to choose a benefits package from several federally approved plans.  The plans range from those available to many federal and state employees to the most popular small business plans to an HMO plan.  In the event the state does not choose a plan, the default plan would be the one that’s available through largest small business plan in the state.

At least one republican, Kansas Insurance Commissioner, Sandy Praeger, was pleased.   "Quite frankly, this was a very smart approach for HHS.  It builds on existing state law."  Praeger also chairs the health care committee of the National Association of Insurance Commissioners.

The new law mandates certain benefits that must be extended, which include: mental health and substance abuse treatment, maternity and childhood care, preventative screenings, prescription drugs, as well as dental and vision care for children.

Insurers who opt-in to provide care in the new health insurance exchanges will have to offer at the minimum, the federally approved packages.