On August 18, 2011, the Departments of Labor, Health and Human Services, and the Treasury released proposed regulations that provide standards for use by group health plans and health insurance carriers in compiling and providing consumers with two forms including:
- An easy to understand summary of benefits and coverage (SBC).
- A uniform glossary of terms commonly used in health insurance coverage, such as “deductible” and “co-pay.”
Under the proposed regulations, all health plans and issuers would need to provide an SBC, along with a uniform glossary of terms, to shoppers and enrollees upon request and before they buy coverage starting March 23, 2012. Health plans and issuers would also need to provide notice at least 60 days before any significant modification was made in the plan or coverage during the plan or policy year.
These proposed rules and standards are designed to enable plan participants to “easily understand their health coverage and determine the best health insurance options for themselves and their families.” To that end, the SBC would need to be presented as a stand-alone document, in a uniform format, use terminology understandable by the average plan enrollee, not exceed four double-sided pages in length, and not include print smaller than 12-point font.
The SBC would include a new, standardized health plan or policy comparison tool for consumers known as “coverage examples,” much like the nutrition facts label required for packaged foods. The coverage examples would illustrate what proportion of care expenses a health insurance policy or plan would cover for three common benefits scenarios — having a baby, treating breast cancer and managing diabetes. Additional scenarios may be added in the future. The examples would help consumers understand and compare their share of the costs of care under a particular policy or plan, and see how valuable the health plan would be at times when they need the coverage.
The Departments released templates, instructions, and related materials to assist with development of the SBC and disclosure of the uniform glossary. For more information about the proposed regulations and to see the related documents and templates, visit the Department of Labor Website. Additional information is also posted on www.healthcare.gov
Please note – These proposed regulations are open to public comments for 60 days from the date of publication in the Federal Register, August 22, 2011. With an open public comment period, these regulations could change. We are also waiting to hear from the carriers about how they will be handling the new regulations as they pertain to Minnesota fully insured and self funded health plans. As additional information becomes available from the government and from the carriers, Unison will continue to keep you up to date. As always, Unison will be working with each of the carriers and our clients to ensure that employees receive the correct information as needed and that all compliance regulations are met.
If you have any immediate questions concerning your company's health plan and the newly released regulations, please contact your Unison Employee Benefits Consultant.
