Employers and plan administrators have a new reporting requirement to fulfill now that the Patient Protection and Affordable Care Act is confirmed to be the law of the land. The U.S. Supreme Court’s ruling in National Federation of Independent Business, et.al. v. Sebelius, No. 11-393 (June 28, 2012) eliminates any doubt regarding whether employers need to comply with the PPACA — including the requirement they provide summaries of benefits and coverage.
SBCs summarize important information about any health coverage option in a standard format to help participants better evaluate and choose among their options.
If a plan offers participants add-ons to major medical coverage that could affect their cost sharing and other information in the SBC — such as a health flexible spending account, health reimbursement arrangement, health savings account or wellness program) the plan can combine information for all of those aspects of the plan and reflect them in a single SBC.
Plans can do that as long as the effects of such add-ons can be denoted in the appropriate spaces on the SBC for deductibles, copayments, coinsurance, and benefits otherwise not covered by the major medical coverage. In such circumstances, the coverage examples should note the assumptions used in creating them.
Application Coming
The U.S. Departments of Labor, Health and Human Services, and the Treasury issued final regulations on Feb. 14, 2012 regarding the requirement that employers issue SBCs.
SBCs must be provided beginning on the first day of the first open enrollment period that begins on or after Sept. 23, 2012:
- from group health plans to participants and beneficiaries when enrolling or re-enrolling ;
- from group health plans to new and special enrollees signing up not during open enrollment period;
- from insurers to group health plans; and
- from insurers to buyers of individual policies.
Finding out More
The DOL’s Employee Benefits Security Administration has prepared frequently asked questions regarding the SBC requirement. They are available online at http://www.dol.gov/ebsa/faqs/faq-aca8.html.