On May 11, 2012 the Departments of Labor, Health and Human Services (HHS), and the Treasury (the Departments) set out additional Frequently Asked Questions (FAQs) regarding implementation of the summary of benefits and coverage (SBC) provisions of the Affordable Care Act. The FAQs address issue such as electronic SBCs, penalties and new documents available on the web.
A previous FAQ outlined the circumstances in which an SBC may be provided electronically. The FAQ discussed a safe harbor for providing the SBC to participants or beneficiaries covered under the plan who are able to access documents provided in electronic form at the worksite.
The Departments have adopted an additional safe harbor for providing SBCs electronically. SBCs may be provided electronically to participants and beneficiaries in connection with their online enrollment or online renewal of coverage under the plan. SBCs also may be provided electronically to participants and beneficiaries who request an SBC online. In either case, the individual must have the option to receive a paper copy upon request.
When displaying the SBC electronically, minor adjustments are permitted to accommodate the plan’s information and electronic display method, such as expansion of columns. Additionally, it is permissible to display the SBC electronically on a single webpage, so the viewer can scroll through the information required to be in the SBC without having to advance through pages (as long as a printed version is available that meets the formatting requirements of the SBC). The deletion of columns or rows is not permitted when displaying a complete SBC.
Plans (and agents and brokers working with such plans) may display SBCs, or parts of SBCs, in a way that facilitates comparisons of different benefit package options by individuals and employers shopping for coverage. For example, on a website, viewers could be allowed to select a comparison of only the deductibles, out-of-pocket limits, or other cost sharing of several benefit package options. This could be achieved by providing the “deductible row” of the SBC for several benefit packages, but without having to repeat the first one or two columns, as appropriate, of the SBC for each of the benefit packages.
However, such a chart, website, or other comparison does not, itself, satisfy the requirements under the final regulations to provide the SBC. The full SBC for all the benefit packages included in the comparison view/tool still must be made available in accordance with the regulations and other guidance.
The Departments are developing a calculator that plans can use as a safe harbor for the first year of applicability to complete the coverage examples in a streamlined fashion; because this approach will be less accurate, it will be allowed as a transitional tool for the first year of applicability. The calculator will allow plans and issuers to input a discrete number of elements about the benefit package. Calculator inputs generally are expected to be taken from data fields used to populate the front portion of the SBC template. The output will be a coverage example that can be added to the corresponding SBC. The Departments will also provide the algorithm that was used to create the calculator. The calculator and algorithm will be posted “soon”.
Group health plan administrators are responsible for providing complete SBCs with respect to a plan. A plan administrator that uses two or more insurance products provided by separate issuers with respect to a single group health plan may synthesize the information into a single SBC, or may contract with one of its insurers (or other service providers) to perform that function.
Due to the administrative challenges of combining benefit package information from multiple insurers, during the first year of applicability, for enforcement purposes, with respect to a group health plan that uses two or more insurers, the Departments will consider the provision of multiple partial SBCs that, together, provide all the relevant information to meet the SBC content requirements. In such circumstances, the plan administrator should take steps (such as a cover letter or a notation on the SBCs themselves) to indicate that the plan provides coverage using multiple different insurers and that individuals who would like assistance understanding how these products work together may contact the plan administrator for more information (and provide the contact information).
Written translations in Spanish, Chinese, and Tagalog are now available. Navajo translations will be available “shortly”.
The Departments recognize that expatriate coverage carries additional administrative costs and barriers in filling out SBCs, including benefit and claims systems that are distinct from those for domestic coverage, which makes compliance more difficult. Therefore, for purposes of enforcement, the Departments will not take any enforcement action against a group health plan for failing to provide an SBC with respect to expatriate coverage during the first year of applicability.
During this first year of applicability, the Departments will not impose penalties on plans that are working diligently and in good faith to comply.
In the diabetes treatment scenario, the version originally posted contained a typographical error, listing the allowed amount for insulin as $11.92, rather than $119.20 – a difference that impacts the total cost of care for diabetes in the coverage example calculations.
To correct this error, the Departments have posted updated versions of the SBC template, the sample completed SBC, and the guide for coverage examples calculations – diabetes scenario. The updated SBC template and sample completed SBC also include sample taglines for obtaining translated documents, as well as updated Sample Care Costs amounts for the diabetes coverage example, due to more accurate rounding in making these calculations. Finally, the updated versions include some appearance modifications (such as changes in bolding, underlining, shading, capitalization, margin justification, use of hyphens, and row and column sizing) to ensure the document is accessible to individuals with disabilities. Plans may use either version, or may make similar modifications to their own SBCs, without violating the appearance requirements for an SBC.
The updated versions of these documents are labeled “corrected on May 11, 2012” in the lower right corner of the first page and are available at www.dol.gov/ebsa/healthreform and cciio.cms.gov. These documents replace the prior versions issued contemporaneously with the final regulations in February 2012.