The Affordable Care Act (“ACA”) requires a summary of benefits and coverage (“SBC”) and uniform glossary to be provided to plan participants at time of enrollment. Significant penalties (up to $1,000) may be imposed for each individual who does not receive this summary. If any material changes are made to the document outside of renewal, the participant must be notified 60 days prior to the effective date of the change.
On December 22, 2014, the Department of Labor (“DOL”), the Internal Revenue Service (“IRS”), and Health and Human Services (“HHS”) (collectively, “the Departments”) issued proposed rules and supporting documents addressing the SBC requirement.
On June 12, 2015, final rules were issued. These final rules largely follow the proposed rules.
The regulations provide new information and also incorporate several FAQs that have been issued since the final SBC regulations were issued in 2012. The rules clarify when and how a plan administrator or insurer must provide an SBC and shorten its length.
The new requirements are effective for plan years and open enrollment periods beginning on or after September 1, 2015. The updated SBC templates and related documents will apply to coverage that begins on or after January 1, 2017.
Questions? Leave them in the comments below or contact a USI associate directly.