New Summary of Benefits Rule: The Devil is in the Details – Part I
One of PPACA's new requirements is that a group health plan provides any eligible individuals with a summary of benefits and coverage (SBC).
The federal agencies in charge of this requirement (HHS, DOL, and IRS) issued proposed regulations last fall, but there was much uncertainty about exactly when the new requirement would apply, among other things. The agencies issued a final rule in February that answered some of these questions (although there still are a number of open issues). 77 Fed. Reg. 8668 (Feb. 14, 2012). Below we answer some of the most frequently asked questions we have received.
When must the SBC be provided?
Generally, group health plans must provide SBCs at enrollment or application for coverage (including HIPAA special enrollees), by the first day of coverage if information has changed, upon renewal, and within 7 business days upon request. Plans also must provide notice of any changes to the SBC at least 60 days in advance. For current enrollees, plans only are required to provide the SBC at renewal for the option in which the individual is enrolled (although they can request other SBCs).
The requirement begins as of January 1, 2013. However, plans whose open enrollment starts on or after September 23, 2012 also must provide SBCs at this year's open enrollment.
What type of document must be provided?
The SBC is a 4-page (double sided) summary of benefits under the plan. Plans must use the template adopted by the agencies, which includes fill-in-the-blank boxes about types of benefits covered, deductibles, and other cost sharing. The template and instructions, along with a sample completed SBC, can be found at www.dol.gov/ebsa.
Do plans have to include information about eligibility and premium amounts in the SBC?
No – the SBC only requires information about benefits that are covered, including whether specific benefits are covered under the plan, exclusions, cost sharing, and annual limits. There is no requirement to list (nor are there blank spaces for) premium amounts or eligibility information. So, if a plan makes changes to eligibility or premium amounts mid-year, this would not impact the SBC.