News & Updates
On June 16, the Departments of the Treasury, Labor and Health and Human Services (collectively, the Departments) released the Summary of Benefits and Coverage (SBC) and Uniform Glossary Final Rule for group health plans and health insurance coverage in the group and individual markets under the Affordable Care Act (ACA).
The Final Rule includes changes to the regulations covering SBC disclosure requirements for plans and individuals. There are no changes to the SBC template or instructions at this time. The Departments have indicated that a revised template and final revised instructions will be released no later than January 2016, and will apply for SBCs issued for plans new or renewing January 1, 2017; individual coverage, January 1, 2017. The SBC is a uniform document designed to help plans and consumers better understand their health coverage and compare coverage options.
Overview of the Final Regulations
The Final Rule incorporated a number of previously issued guidance in the form of Frequently Asked Questions (FAQs) as well as adopted new standards. Among the changes, the Final Rule clarifies that if the issuer provides the SBC upon request before application for coverage, the requirement to provide the SBC upon application is satisfied provided there is no change to the information required to be in the SBC. Note, if the plan sponsor is negotiating coverage terms at the time of initial enrollment, an updated SBC reflecting the final coverage terms is required to be provided to the plan or its sponsor on the first day of coverage, or upon request if an updated SBC is requested.
Within the Final Rule, the Departments retained three existing special anti-duplication provisions from the 2012 final regulations and added two additional provisions to ensure participants and beneficiaries receive information while preventing unnecessary duplication. The additional anti-duplication provisions added to the Final Rule are:
The Departments also codified additional enforcement safe harbors from previously issued FAQs, including:
Specific to the individual market, the Final Rule states that if an issuer offering individual market insurance coverage automatically reenrolls an individual and any dependents into a different plan or product than the plan in which these individuals were previously enrolled, the issuer would be required to provide an SBC with respect to the coverage in which the individual (including every dependent) will be enrolled, consistent with the timing requirements that apply when the policy is renewed or reissued.
Furthermore, Qualified Health Plan (QHP) issuers must disclose on the SBC for QHPs sold through an individual market Exchange whether abortion services are covered or excluded, and whether coverage is limited to excepted abortion services.
The Final Rule also requires an Internet web address where a copy of the actual individual coverage policy or group certificate of coverage can be reviewed and obtained. This provision is applicable to issuers and not self-insured plans. The preamble to the Final Rule clarifies that for the group market only; an issuer is permitted to satisfy this requirement with respect to plan sponsors that are shopping for coverage by posting a sample group certificate of coverage for each applicable product. After the actual certificate of coverage is executed, it must be easily available to plan sponsors and participants and beneficiaries via an Internet web address.
The Final Rule specifies that the SBC cannot exceed four double-sided pages. The Departments will address specific issues related to completing the four-page template, as well as the problems plans and issuers encounter meeting these requirements with the finalization of the new template and associated documents, separate from this Final Rule.
Applicability Dates with respect to disclosures to participants and beneficiaries
Applicability Dates with respect to the new template and associated documents
The Departments anticipate that the new template will be finalized by January 2016 and will apply to coverage that would renew or begin on the first day of the first plan year (or, in the individual market, policy year) that begins on or after January 1, 2017 (including open enrollment periods that occur in the Fall of 2016 for coverage beginning on or after January 1, 2017).