SUMMARY OF BENEFITS AND COVERAGE
AND UNIFORM GLOSSARY (SBC)
On
February 14, 2012, the Department of Treasury, Internal Revenue Service,
Department of Labor, Employee Benefits Security Administration and the Department
of Health & Human Services issued the Final Guidance & Rules regarding The Summary of Benefits
and Coverage and Uniform Glossary (SBC). The SBC requirements state that
group health plans must ‘accurately describe the benefits and coverage under the
applicable plan or coverage’ and calls for the ‘development of standards for
the definitions of terms used in health insurance coverage.’ These
requirements go into effect the first day of the group plan year that begins on
or after September 23, 2012.
An
SBC should be provided to applicants, enrollees, and policyholders or
certificate holders. The responsibility to provide an SBC is on the health
insurance issuer (including a group health plan that is not a self-insured
plan) offering health insurance coverage within the US; or in the case of a
self-insured group health plan, the plan sponsor or designated administrator of
the plan (as such terms are defined in section 3(16) of ERISA). In addition, the
final regulations hold the plan administrator of a group health plan
responsible for providing an SBC.
Under
the final regulations, the SBC must be provided in writing and free of charge:
1) by a group health insurance issuer to a group health
plan
2) by a group health insurance issuer and a group health
plan to participants and beneficiaries, and
3) by a health insurance issuer to individuals and
beneficiaries in the individual market
An
SBC is not required for plans, policies or benefit packages that constitute
excepted benefits such as standalone dental or vision plans. Flexible Spending
Accounts (FSAs) and Health Savings Accounts (HSAs) generally do not fall under
the requirements for an SBC but coverage for such can be denoted in the
appropriate spaces on the SBC for deductibles, copayments, coinsurance and
benefits otherwise not covered by group health coverage. An SBC with a high deductible plan associated
with an HSA should mention the effects of employer contributions. A Health
Reimbursement Arrangement (HRA) is a group health plan and requires an SBC;
however, coverage can be denoted in the appropriate spaces on the SBC for
deductibles, copayments, coinsurance and benefits otherwise not covered by the
other group health coverage.
More
information on SBC will be provided in the coming months.
