Final Rules Published: Summary of Benefits & Coverage
On February 9, 2012, the Department of Health and Human Services Center for Consumer Information and Insurance Oversight issued final regulations that mandate health insurers and group health plans to provide in “plain language, simple and consistent information about health plan benefits and coverage.”
The rules require health plans to provide a Summary of Benefits and Coverage (“SBC”) and a mandated Uniform Glossary that explains terms commonly used in health insurance such as “deductible” and “co-payment.”
SBCs to Provide Clarity of Coverage
The SBC is envisioned to assist enrollees with understanding the coverage they have and to allow more meaningful comparisons between competing plans. Key features like covered benefits, cost-sharing provisions, and coverage limitations and exceptions explained in uniform terms and in plain language, or language that is simple enough for the average health plan participant to comprehend. The SBC must be available to plan participants at important points in the enrollment process, such as when they are shopping for coverage, when they apply for coverage, at each new plan year, and at any time upon request.
New Notice Requirements
Health insurers and group health plans will be subject to new notice requirements regarding coverage and benefits when shopping or applying for coverage, when coverage is renewed, when coverage changes, and when enrollees demand a copy of the SBC or Uniform Glossary.
In the self-funded context, the SBC is to be provided upon enrollment and renewal. Significant changes to a plan in the middle of a plan year must be communicated to enrollees at least 60 days prior to the change taking effect. And if an enrollee requests an SBC and/or Uniform Glossary it must be provided to the plan participant within 7 days.
The SBC Can be a Stand-Alone Document or Included in SPD
The regulations state that an SBC for group health plan coverage may be issued either as a stand-alone document or combined with other summary materials (e.g. in a Summary Plan Description). However, the SBC information must be intact and displayed prominently at the beginning of the materials, (e.g. immediately after the Table of Contents in an SPD) and in accordance with the timing requirements for providing an SBC.
Effective Date
The requirements to provide an SBC, notice of modification, and Uniform Glossary under the final regulations for plans with open enrollment start on the first day of the first open enrollment period that begins on or after September 23, 2012.
For plans without open enrollment the final regulations apply beginning on the first day of the first plan year that begins on or after September 23, 2012.
Additional Information
To view the final template for the Summary of Benefits and Coverage, visit: http://cciio.cms.gov/resources/other/index.html#sbcug
To view the final rule, visit: http://www.ofr.gov/inspection.aspx
Other technical information is available at: http://cciio.cms.gov/
If you have any questions about the SBC, Uniform Glossary, or plan modification requirements please contact us.