With fall open enrollment season upon us, group health plan sponsors should remember that the new Summary of Benefits and Coverage (“SBC”) requirements are now in effect. The first SBC must be provided to participants and beneficiaries for enrollment or re-enrollment periods beginning on or after September 23, 2012. This means that calendar year plans conducting open enrollment this fall for the upcoming plan year must generally include the SBC with enrollment materials.
Plan sponsors may be wondering whether and when it is permissible to distribute the SBC electronically to participants and beneficiaries. The agencies have issued guidance about when it is permissible to distribute the SBC electronically. Generally, the application of the electronic delivery rules depends on whether the recipient is enrolled in the plan and how the recipient enrolls in the plan.
For active employees who are already enrolled in the plan, the DOL’s normal electronic disclosure safe harbor applies. Electronic delivery of the SBC is permissible if the employee can access electronic documents at any location where the employee is reasonably expected to perform his or her duties and that access is an integral part of their job duties. Electronic delivery is also permissible if the employee has affirmatively consented (in electronic or non-electronic form) to receiving documents through electronic media and has not withdrawn consent.
For individuals who have not yet enrolled in the plan, electronic delivery of the SBC is permissible if the individual actually enrolls online and the SBC is provided as part of the online enrollment process, or the individual is notified by e-mail or paper that the SBC is available online. The individual must have the option to receive a paper copy of the SBC upon request.
If all enrollment occurs online, then it is permissible to provide the SBC through electronic delivery to enrollees and nonenrollees alike.
As a reminder, in addition to providing the SBC with any application materials for enrollment, there are other instances in which the SBC must be provided. If the plan has “evergreen” elections where there is no opportunity to change coverage options, then the SBC must be provided 30 days before the first day of the plan year. If the SBC or summary information about the plan is requested, the SBC must be sent within seven business days of the request. For special enrollees, the SBC must be provided within 90 days from the date of enrollment (the same time frame for providing the summary plan description).
For past coverage of the SBC, please see our prior posts.