UPDATE: On April 6, 2016, the Department of Health and Human Services (HHS), DOL, and Department of the Treasury finalized the proposed SBC template, Uniform Glossary, and instructions. The Departments confirmed that plans and issuers shall use the final SBC template and associated resources beginning on the first day of the first open enrollment period that begins on or after April 1, 2017. The final SBC template, Uniform Glossary, and instructions may be found here.
On Thursday, February 25, the U.S. Department of Labor (DOL) published a new proposed template for the Summary of Benefits and Coverage (SBC) and Uniform Glossary. The new SBC template and Uniform Glossary is expected to be utilized for health plans beginning on or after April 1, 2017. The formal notice and submission to the Office of Management and Budget (OMB) for review and approval may be found here. The OMB is accepting public comments on the proposed SBC template and Uniform Glossary through March 28, 2016.
Consistent with prior guidance and incorporating input from a National Association of Insurance Commissioners (NAIC) stakeholder group, the new proposed SBC template and instructions contains a number of revisions and modifications from the initial template originally proposed in 2012. The changes in the new proposed SBC template and instructions include, but are not limited to, the following:
- A new question identifying any services covered before the deductible is met (page 1 of the template);
- A new instruction requiring the use of specific language to identify whether the plan has “embedded” or “non-embedded” deductibles or out of pocket maximums (page 6 of the instructions);
- A new instruction requiring the use of specific language to identify whether the plan uses a tiered network to alert participants that costs for in-network services may vary depending on the tier of the physician or facility (page 9 of the instructions);
- A new instruction requiring a list of certain “core” limitations, including when cost-sharing for in-network services does not count toward the out of pocket limit (for example, cost-sharing for in-network items or services that are not essential health benefits), prior authorization requirements, visit limits, or exclusion of a particular service category or substantial part of a service category (for example, exclusion of brand name drugs if the plan only covers generic drugs) (page 11 of the instructions); and
- A new coverage example for a simple fracture (page 5 of the template).
The new proposed template also includes a statement indicating whether the plan meets Minimum Essential Coverage (MEC) and Minimum Value (MV). However, many health insurance issuers and third-party administrators are already including these statements in the current SBCs issued to group health plans.
The proposed template, instructions, and other resources may be found on the DOL’s website here. You may find the blank proposed template in PDF format here, and the instructions for completion of the template for group health plans here. Please note that there are separate instructions for completing the new template for an individual health insurance plan.
Overall, the new proposed SBC template takes a step forward in streamlining the SBC and making it more user friendly for plan participants. However, it is not unusual to find errors on the SBCs issued by health insurance issuers and third-party administrators. Plan sponsors should review their SBCs for each plan option at renewal to ensure accuracy, and be prepared for SBCs issued after April 1, 2017 to contain some new information. Stay tuned to the Healthcare Reform Digest for updated information once the proposed SBC template is finalized.