The Departments of Health and Human Services (“HHS”), Labor (“DOL”), and Treasury (the “Departments”) have jointly released final changes to the Summary of Benefits and Coverage (“SBC”) template, the Uniform Glossary, and accompanying documents.
The ACA requires group health plans and health insurance issuers to compile and provide to consumers an SBC that describes the benefits and coverage under the applicable plan and coverage options. This requirement is intended to help consumers better understand and make more informed choices about their coverage options, and it applies to insured and self-funded ERISA group health plans (including grandfathered plans), and to non-ERISA group health plans and individual health insurance coverage.
The SBCs provided to consumers must follow a uniform format and contain certain information. This information includes uniform standard definitions of medical and health coverage terms, a description of the coverage, cost-sharing requirements, and information regarding any exceptions, reductions or limitations under the coverage. The Departments have provided a template for health plans and issuers to use that will allow them to comply with the requirements.
The template currently in use was released in April of 2013. After issuing a proposed rule amending the SBC regulations in December of 2014, a Final Rule in June of 2015 (which finalized most of the 2014 proposed revisions), and revised SBC templates and accompanying documents in February of 2016, the Departments released final SBC templates and accompanying documents on April 6, 2016. The changes to the requirements and templates and all relevant effective dates are described below.
Changes to Requirements
The requirement that health plans and health insurance issuers use 12-point font and replicate all symbols, formatting, bolding and shading where applicable on the SBC have not changed. However, to maintain the four double-sided page limit, the Departments have now allowed more flexibility in form language and formatting. For example, plans and issuers may use different fonts and adjust margins as necessary. The Departments also added required definitions to the Uniform Glossary, and have provided that plans and issuers may hyperlink the terms to a micro-site that HHS will maintain, at https://www.healthcare.gov/sbc-glossary/.
Changes to SBC Template
The Departments also added, deleted and changed certain language and terms in the new SBC template. Some key examples of their changes include:
- The addition at the beginning of the SBC of a simple explanation of what an SBC is and where consumers can find more information.
- The addition to the description of deductibles of how family members must meet their own individual deductibles before the overall family deductible is met and what services are covered before the deductibles are met.
- The changing of the term “person” to “individual.”
- The addition of a statement that copayments for certain services may not be included in out-of-pocket limits.
- The removal of definitions of copayments and coinsurance from page 2 of the template.
- The changing of the “Limitations & Exceptions” column to a “Limitations, Exceptions, & Other Important Information” column, which must now include:
- When the plan or issuer does not cover a particular service category, or a substantial portion of a service category;
- When cost sharing for covered in-network services does not factor into the out-of-pocket limit;
- Visit or dollar limits; and
- When services require prior authorization.
Cross-referencing is allowed if including all limitations and exceptions would cause a violation of the page limit requirement.
- The addition of the following under Common Medical Events:
- “You may have to pay for services that aren’t preventive. Ask your provider if the services needed are preventive. Then check what your plan will pay for.”
- A direct link or URL to the formulary drug list where the consumer can find more information about prescription drug coverage, and drug tier information.
- Mental/behavior health and substance abuse are combined into one row, and there is one row each for inpatient services and outpatient services.
- New rows for the “If you are pregnant” category: (1) Office visits; (2) Childbirth/delivery professional services; and (3) Childbirth/delivery facility services.
- The addition of disclosure language about minimum essential coverage, minimum value, and language access services.
- The addition of a third coverage example.
- Changed formatting and other language on the Coverage Examples page.
- Includes an updated note about wellness programs.
- Includes a new note that the plan has other deductibles for specific services included in the applicable coverage example.
- Includes a footnote stating, “The plan would be responsible for the other costs of these EXAMPLE covered services.”
- Qualified Health Plan issuers (“QHPs”) must reflect in the SBC whether it covers abortion services.
Plans and issuers operating on a calendar year plan year must use the new SBC templates in time for the first open enrollment period beginning on or after April 1, 2017. This means most individual market issuers and any group health plans operating on a calendar year will need to use the new SBC documents by November 1, 2017 for the plan year beginning January 1, 2018.
Non-calendar year plans must use the new SBC documents beginning with the first plan year beginning on or after April 1, 2017. For example, if a group health plan has a plan year beginning October 1, the plan would need to provide the new SBC documents to its participants no later than October 1, 2017.
What Employers Should Do
Carefully review the modifications to the SBC template, the instructions, the Uniform Glossary and the accompanying documents to determine how the employers and the documents are affected. Begin using the updated templates by the effective dates provided above. The revised template, instructions, and other documents can be found at: https://www.dol.gov/ebsa/healthreform/regulations/summaryofbenefits.html. The sample completed SBC can be found at: https://www.dol.gov/ebsa/pdf/Sample-Completed-SBC2-final.pdf.