User-Friendly Healthcare Information?

That's the Goal.
By SRA Benefits

New rules under the Affordable Care Act (ACA) requires businesses renewing their group healthcare plans after September 23, 2012, to provide consumers with clear, consistent, and comparable information about their health plan benefits.

Specifically, these rules will ensure consumers have access to two key documents that will help them understand and evaluate their health insurance choices:

• Short easy-to-understand Summary of Benefits and Coverage ( or “SBC”); and 
• A uniform glossary of terms commonly used in health insurance coverage, such as “deductible” and “co-payment." 

Who is Responsible for the SBC?
Insurance companies are working hard to prepare the SBC documents to share with their customers, but it is the business owner’s responsibility for distributing them to plan participants (for all insured and self-funded ERISA and non-ERISA group health plan customers, including those that are grandfathered).   Employers should check with their carrier or their advisor to see when their SBC documents will be available.

For self-insured plans, the employer is responsible but may make arrangements for their third party administrator to produce and distribute the SBC.

Key Features

One of the key features of the SBC is a plan comparison tool called “coverage examples” which will illustrate sample medical situations and how they would be covered under the plan.  The examples are meant to help consumers understand and compare what they would have to pay under each plan they are considering.

With the mandated timeframes and notification procedures it will become imperative that employers make their benefits decisions earlier to stay in compliance with these new requirements.   For example: For open enrollment and renewals on or after September 23, SBCs should be available to employers for distribution to their employees no later than 30 days before the start of the new policy year.

Guidelines for both a printed version of the SBC and requirements for electronic access to benefit information are also in place.  Your insurance carrier or advisor can provide more detail.

Penalties Can Be Costly

During the first year, the federal watch dog agencies have indicated they will not impose penalties on issuers and employers that are working diligently and in good faith to comply.  However, businesses that willfully fail to comply may be subject to a fine of up to $1,000 for each failure per enrollee. 

For more information on Summary of Benefits Coverage,  visit: http://www.healthcare.gov/news/factsheets/2011/08/labels08172011a.html