On August 22, 2011, the Department of Health and Human Services (HHS) , the Department of Labor (DOL), and the Department of the Treasury (DOT) (collectively, the Agencies) issued proposed regulations under the Patient Protection and Affordable Care Act (PPACA) governing disclosures of information about group and individual health plans mandated by section 2715 of the Public Health Service Act (PHS Act), which was added by PPACA. Section 2715 requires the Agencies to develop standards for group health plans and insurance issuers to create and distribute a summary of benefits and coverage (SBC). The statute mandated that a working group of the National Association of Insurance Commissioners (NAIC) be consulted in developing such standards. The proposed rule adopts all of the NAIC working group’s recommendations and establishes who must issue an SBC, when an SBC must be issued and updated, the form in which an SBC must be distributed, to whom the SBC must be distributed, and the content of an SBC (including hypothetical benefits scenarios that are to be included with each SBC). The Agencies also proposed a uniform glossary of key insurance-related terms that will be used in drafting an SBC. Under PPACA, any group health plan or issuer that willfully fails to provide an SBC as required by the statute is subject to a fine of no more than $1,000 for each such failure.
In conjunction with the proposed rule, the Agencies also issued a solicitation of comments regarding a proposed template for the SBC, uniform glossary, sample instructions and calculations, and related documents developed in conjunction with the NAIC working group. The Agencies have solicited public comments regarding the proposed standards, including the uniform glossary, template and related documents. Comments are due by Friday, October 21, 2011.
The proposed rule is available by clicking here and the solicitation of comments is available by clicking here. Information regarding the recommendations and proposals of the NAIC working group is available by clicking here.