Group health plan and insurance coverage: final guidance issued on summary of benefits and coverage

The U.S. Departments of the Treasury, Labor (DOL) and HHS (collectively, the "Departments") recently released final regulations governing the summary of benefits and coverage and the uniform glossary for group health plans and health insurance coverage. By way of background, Section 2715 of the Public Health Service Act, as added by PPACA, charged the Departments with the development of (1) standards for compiling and providing a summary of benefits and coverage explanation (SBC), including who must provide the SBC, to whom the SBC must be provided and when, and what content must be included in the SBC; and (2) a standard set of definitions for certain insurance-related and medical terms. PPACA also requires that group health plans and health insurance issuers provide a notice of modification to participants and beneficiaries if material terms of the plan or coverage change from the terms described within the most recent SBC. The final regulations address each of these items.

Additional guidance about the SBC was published simultaneously to the regulations. The guidance addresses the format of the SBC for the first year in which the SBC requirements apply (updated guidance will be issued by the Departments in later years). It also includes the HHS and DOL website addresses where one can find (1) a template for the SBC, (2) a sample completed SBC, (3) instructions for completing the SBC template, (4) language that must be used when completing the SBC template, (5) a guide for coverage example calculations, and (6) the uniform glossary required under PPACA.

Importantly, the final regulations generally extend the compliance deadline for the SBC from March 23, 2012, to September 23, 2012. Specifically, participants and beneficiaries who enroll or reenroll in group health coverage through an open enrollment period, and participants and beneficiaries who enroll in group health coverage other than through an open enrollment period, must be provided an SBC no later than the first day of the first open enrollment period that begins on or after September 23, 2012, or the first day of the first plan year beginning on or after September 23, 2012, respectively. The compliance deadline for disclosures made to plans and to individuals in the individual market by health insurance issuers is September 23, 2012.