HHS Amends Rules on SBCs (Summary of Benefits and Coverage) again
While the final rule on the SBCs makes several, important improvements over the preliminary rule (which you read about here on 9/16/2011, and then read about the delay on 11/18/11) employers and plan sponsors will still need to use the additional time to wrestle with potential costs and resources required to deliver something that will arguably overwhelm their plan participants and quite possibly outweigh the benefits the federal government hopes to gain.
Today, prudent plan sponsors are already updating their benefit guides, open enrollment materials and SPDs (Summary Plan Descriptions) in order to provide clear, concise communications to help participants make decisions. These SBCs may require an overhaul of how information is presented to consumers. For employers whose policies/plans take effect on or after September 23, 2012 you’ll need to have SBCs prepared and ready to go.
Effective Date Language and Rules
The requirements to provide an SBC, notice of modification, and uniform glossary apply for disclosures to participants and beneficiaries who enroll or re-enroll in group health coverage through an open enrollment period (including re-enrollees and late enrollees) beginning on the first day of the first open enrollment period that begins on or after September 23, 2012.
But, what if you are outside of Open Enrollment? The requirements apply beginning on the first day of the first plan year that begins on or after September 23, 2012.
Example for a 1/1 plan that will renew on 1/1/2013. You will have SBCs ready for your 2013-plans and will distribute them in late-October for your mid-November open enrollment period. Luckily, you won’t also have to have 2012-SBCs ready for your post-9/23/2012 new hires, since this latest guidance doesn’t make the SBC requirement effective until the first day of the first plan year after 9/23/2012.
SBCs need now only contain information about two coverage examples: (1) having a baby (via a normal delivery) and (2) managing type 2 diabetes (routine maintenance of a well-controlled condition). This approach differs from the initial guidance that required a third coverage example for breast cancer treatment. The new guidance also permits grayscale or color to be utilized for the SBCs and the Uniform Glossary.
Bundled with Other Documents
The Departments’ 2011 proposed regulations (IRS, DOL, HHS) would have required that a group health plan and a health insurance issuer provide an SBC as a stand-alone document. This requirement was eliminated with respect to group health plan coverage in the final regulations.
Now, the Departments authorize the SBC to be provided either as a stand-alone document or in combination with other summary materials (for example, a Summary Plan Description or an Open Enrollment Benefit Guide), if the SBC information is intact and prominently displayed at the beginning of the materials (such as immediately after the table of contents in an SPD).
For health insurance coverage provided in the individual market, the SBC must be provided as a stand-alone document.
Culturally and Linguistically Appropriate Manner – Retained
The Health Plan or Carrier satisfies this requirement by following the rules established under the Public Health Service Act (section 2715-2719) by providing such notices when 10 percent or more of the population residing in the claimant’s county are literate only in the same non-English language, as determined based on American Community Survey data published by the United States Census Bureau. The Departments note that at “the time of publication of this guidance document, 255 U.S. counties (78 of which are in Puerto Rico) meet this threshold. The overwhelming majority of these are Spanish; however, Chinese, Tagalog, and Navajo are present in a few counties, affecting five states (specifically, Alaska, Arizona, California, New Mexico, and Utah).”
- HHS’ CCIIO (Center for Consumer Information & Insurance Oversight), Revised SBC guidance
- Uniform Glossary, Instructions, Guidance and Samples (in Word and PDF, some blank for use, others are PDF samples)
- DOL, Affordable Care Act Links and Guidance
- DOL, Final SBC Regulations
- Counties where non-English languages are spoken more than 10% of the time (see page 21 of 39, Table 2)
- Center for Consumer Information (CMS/CCIIO) update, Culturally & Linguistically Appropriate Services (CLAS) County Data – more condensed format than original posting (above)