The rule requires that insurers and health plans provide a standardized Summary of Benefits and Coverage (SBC) and Uniform Glossary to consumers “when shopping for coverage, enrolling in coverage, at each new plan year, and within seven (7) business days of requesting a copy from their health insurer or group health plan.”

 The SBC will describe health plan benefits in easy to understand terms; it will include what the plan will cover, what limitations or conditions will apply, and coverage examples. These examples are a key feature of the SBC, illustrating how much coverage the plan would provide in an event such as having a baby or managing Type II diabetes. These examples are designed to help consumers understand and compare what they would have to pay under each plan that they are considering.

For group health plans, the SBC must be provided to participants enrolling or reenrolling prior to the first day of open enrollment beginning on or after 9/23/2012. For newly eligible participants or special enrollees, the SBC must be provided on the first day of the plan year following 9/23/2012. If plan changes are made other than at renewal, individuals must be informed in writing 60 days ahead of any significant plan changes.

The law is very specific regarding the format of the SBC: It cannot exceed four double-sides pages in length and must not include print smaller than a 12-point font. In addition, it must include a phone number and internet address for questions and copies of plan documents. The SBC may be provided in paper or electronic form under current ERISA electronic distribution rules and while it can be included with other documents (e.g. summary plan description) it must be prominently displayed at the beginning of the document.

For fully insured groups, the SBC will be provided by the insurance carrier. For self-funded groups we will work with carriers to obtain SBCs.

Click here to view the template for the Summary of Benefits and Coverage and the glossary.

BCBS GA members who have question about this change should call the customer service number on the back of their ID cards.

Due to the agreement reached late yesterday, Blue Cross Blue Shield of Georgia HMO, POS, PPO, and Indemnity members can continue to utilize Tenet facilities as in-network providers and there will be no break in their network participation.

The agreement reached between BCBS GA and Tenet covers Tenet’s five acute care hospitals in Georgia (Atlanta Medical Center, North Fulton Hospital, South Fulton Medical Center, Spalding Regional Medical Center, and Sylvan Grove Hospital) as well as freestanding outpatient centers and physicians who are employed by Tenet subsidiaries.

Tenet facilities include: Atlanta Medical Center, North Fulton Hospital, South Fulton Medical Center, Spalding Regional Medical Center, and Sylvan Grove Hospital. All BCBS GA health plans will be affected by Tenet’s contract termination, including the Blue Distinction program (bariatric surgery at Atlanta Medical Center and the spine surgery program at North Fulton Hospital).

BCBS GA recommends the following alternative hospitals:

The termination also affects Tenet employed physicians who only admit to Tenet hospitals and do not have admitting privileges to other participating hospitals. To check the network status of a physician, go to www.bcbsga.com and click “Find a Doctor” or call the customer service number found on the back of BCBS GA ID cards.

If you are an inpatient at one of the above Tenet facilities on February 1, Tenet must continue to honor the in-network reimbursement rate until you are discharged from the hospital. Your claim will be paid at the in-network level of benefits. If you currently receive care from a Tenet physician who is terminating on February 1, you may be eligible for continuity of care benefits. Eligibility is based on active treatment for a specific medical condition. You can obtain the required form for continuity of care at www.bcbsga.com or by calling the customer service number found on the back of BCBS GA ID cards. All other services rendered by Tenet facilities on or after February 1, 2012, will be paid at the out-of-network benefit rate.

Walgreens Leaves BCBS and Express Scripts Network
As expected, Walgreens terminated their contract with BCBS and Express Scripts on December 31, 2011. In order to limit disruption and inconvenience to members, BCBS GA is making automated calls to members who visit a Walgreens on or after January 1, 2012 and members who use Walgreens, are on maintenance medications, and are approaching or have missed their refill date. The automated call campaign will run through February and will assist members in moving their prescriptions to in-network pharmacies. Members can also visit www.bcbsga.com and click “How to Find an In-Network Pharmacy” in the bottom right corner of the home page.

Employers who will issue 250 or more W-2s for the 2011 tax year are required to required to report coverage for the 2012 tax year; W-2s for 2012 must be issued in January 2013. (Note: the employer requirement is not based on the number of covered employees, but on the number of W-2s issued by an employer, including those issued to active, terminated, full-time, part-time, and seasonal employees.) Transitional relief has been given to “small” employers, those who issue fewer than 250 W-2s until further guidance is issued. When guidance is issued, it will apply prospectively and will not apply to any calendar year beginning within 6 months of the date guidance is issued.

Employers must report on an employee’s Form W-2 for the year 2012, in Box 12, Code DD, the (calendar year) cost of major medical insurance, mini-med plans, on-site clinics, wellness programs, and executive reimbursement plans. The IRS emphasizes that both the employer and employee contributions are to be reported. The reportable cost includes the cost of coverage for the employee and any person covered by the plan because of a relationship to the employee. (For example, coverage for spouses, domestic partners, dependent children, etc.) The reportable cost of coverage can be calculated by using the premium charged method, the COBRA applicable premium method (less the 2% COBRA admin fee), or the modified COBRA premium method. The employer may choose any of these methods but should be consistent in their reporting. If the cost of coverage changes during the year, the reportable amount must reflect any increases or decreases in cost.

Excluded from the reporting requirement are contributions to Archer Medical Savings Accounts, HSAs, HRAs, employee contributions to FSAs, costs for Long Term Care insurance, and stand-alone dental and vision insurance coverage.

The mandated W-2 reporting is for informational purposes only. It does not cause excludable employer-sponsored health coverage to become taxable to the employee. The purpose of the reporting requirement is to educate and inform employees about the true cost of their health coverage.

Further, as part of the transitional relief, employers are not required to report the cost of coverage on Form W-2 to a terminated employee who requests their W-2 before the end of the year.

This summary is intended to provide a general overview of the W-2 reporting requirement. Additional information can be found on the IRS website.

On November 17, 2011 the Department of Labor (DOL) responded to concerns regarding the timeframe and lack of final regulations. The notice stated “until final regulations are issued and applicable, plans and issuers are not required to comply with section 2715 of the Public Service Act” and that the final rules and guidance will be issued “as soon as possible.”

The DOL also commented that once the final regulations are issued they will also provide a date the regulations will apply that allows health plans and insurers sufficient time to comply.

The Regulations that have yet to be issued by the Department of Health and Human Services will provide additional guidance regarding the implementation of the following requirements:

• A glossary of standard medical and insurance terms
• A four-page Summary of Benefits and Coverage describing plan benefits, cost sharing and limitations
• Coverage examples illustrating customer costs based on the specific plan’s benefits for common medical scenarios, currently identified as: maternity, breast cancer treatment and diabetes management
• Online availability of documents including Certificates, Summary Plan Descriptions (SPDs) and policies
• Notification of material modifications at least 60 days before their effective date
• Failure to provide the required information will result in a fine of not more than $1,000 per enrollee.

If you would like to read the DOL’s complete response click here.

While this represents a significant reduction in the number of available pharmacies, Express Scripts research shows the average distance to an alternative network pharmacy from covered members work or home address changes by less than two tenths of a mile.

For participants who have open prescriptions at Walgreens that extend beyond December, a transfer of the prescription to a new network pharmacy will be necessary for the benefits remain in-network and paid according to the pharmacy benefit.

In addition to deciding whether the law’s individual insurance mandate is constitutional, the justices will also determine whether the rest of the law can take effect even if that particular mandate is held unconstitutional.  Opponents of the law believe that if the individual requirement fails, the entire Act should fail.  A decision in late June is expected to have a significant impact on the 2012 presidential election.

The Community Living Assistance Services (CLASS) Act program was intended to provide a basic lifetime benefit of at least $50 a day in the event of illness or disability. Coverage would have been provided to employees through the workplace, with all premiums paid by employees. The program was originally set to begin in January 2011 but was delayed earlier this year.

Public awareness of long term care insurance is growing and more and more employers now offer long term care insurance as a voluntary employee benefit. Premiums for coverage through an employer-sponsored plan are often lower than employees would pay for individual policies and coverage can be deducted through a salary deferral arrangement.