Health reform’s SBC rules include 12 required content elements

There’s a lot to digest in the newly-released guidance on the Summary of Benefits and Coverage (SBC) requirements under the Patient Protection and Affordable Care Act (PPACA). Did you know, for instance, that there are a total of 12 required content elements under these regulations? There would’ve been 13 required items but a provision requiring the SBC to include premium or cost of coverage information was dropped from the final version of the guidance.

The first nine required content elements appeared in the text of the PPACA itself. Proposed regulations, issued in 2011, added four additional required content elements. Of those four additional elements, in the end, the agencies kept two of them, modified one (the one relating to a uniform glossary), and dropped a provision requiring the SBC to include premium or cost of coverage information.

Required content elements.
The 12 required content elements include:

• Uniform definitions of standard insurance terms and medical terms so that consumers may compare health coverage and understand the terms of (or exceptions to) their coverage;
• A description of the coverage, including cost sharing, for each category of benefits identified by the agencies;
• The exceptions, reductions, and limitations on coverage;
• The cost-sharing provisions of the coverage, including deductible, coinsurance, and copayment obligations;
• The renewability and continuation of coverage provisions;
• A coverage facts label that includes examples to illustrate common benefits scenarios (including pregnancy and serious or chronic medical conditions) and related cost sharing based on recognized clinical practice guidelines;
• A statement about whether the plan provides minimum essential coverage as defined under Code Sec. 5000A(f), and whether the plan’s or coverage’s share of the total allowed costs of benefits provided under the plan or coverage meets applicable requirements;
• A statement that the SBC is only a summary and that the plan document, policy, or certificate of insurance should be consulted to determine the governing contractual provisions of the coverage; and
• A contact number to call with questions and an Internet web address where a copy of the actual individual coverage policy or group certificate of coverage can be reviewed and obtained;
• For plans and issuers that maintain one or more networks of providers, an Internet address (or similar contact information) for obtaining a list of the network providers;
• For plans and issuers that maintain a prescription drug formulary, an Internet address where an individual may find more information about the prescription drug coverage under the plan or coverage; and
• Information for obtaining copies of the uniform glossary, which includes an Internet address where an individual may review the uniform glossary, a contact phone number to obtain a paper copy of the uniform glossary, and a disclosure that paper copies of the uniform glossary are available.

Dropped from the final version of the regulations was a provision in the proposed rules that would’ve required the SBC to include premiums or cost of coverage for self-insured group health plans. The agencies involved (the IRS, the Labor Department, and the Department of Health and Human Services) understand that it is administratively and logistically complex to convey this information to individuals in an SBC in differing circumstances in both the individual and group markets, citing as an example, a situation when premiums differ based on family size and when, in the group market, employer contributions impact cost of coverage. The agencies recognize that the inclusion of premium information in the SBC could result in numerous SBCs being required to be provided to individuals. However, if premium information is not required in the SBC, the agencies point out, only a single SBC might be necessary. The agencies believe that premium information can be more efficiently and effectively provided by means other than the SBC.

Standalone document not required. Finally, the requirement that group health plans provide the SBC as a stand-alone document has been eliminated. The SBC may be provided either as a stand-alone document or in combination with other summary materials (for example, an SPD) if the SBC information is intact and prominently displayed at the beginning of the materials, such as immediately after the Table of Contents in an SPD.

Electronic ok. Assuming certain consumer safeguards are met, the final rule ensures that in the vast majority of cases, the SBC can be provided electronically, allowing a plan or issuer to post the SBC on its website or provide it by email. Electronic disclosure is expected to reduce costs while consumer safeguards are designed to ensure actual receipt by individuals.