Benefits U

Summary of Benefits and Coverage Rule Final

On February 9, HHS issued its final rule regarding the Summary of Benefits and Coverage (SBC) provision contained in the 2010 Healthcare Reform law. The SBC rule applies to both fully insured and self-insured group health plans (domestic and international) , and applies to grandfathered plans.

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.

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