Agencies Propose Revisions to Summary of Benefits and Coverage Template and Uniform Glossary
The Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Internal Revenue Service (IRS) (the agencies) have released proposed revisions to the uniform glossary and the template of the summary of benefits and coverage (SBC) required to be provided by a group health plan or health insurance issuer. The proposed revisions are subject to approval by the Office of Management and Budget (OMB) and therefore also open to public comment. The agencies published the notice of the proposed revisions in the February 26, 2016, Federal Register.
The proposed template and uniform glossary have been posted on the DOL and HHS websites. A sample completed SBC with the proposed revisions may be found at the DOL website at http://www.dol.gov/ebsa/pdf/sbc-completed-sample-proposed-new.pdf .
The proposed revised uniform glossary may be found on the DOL website at http://www.dol.gov/ebsa/pdf/sbc-uniform-glossary-proposed-new.pdf.
Effective Date: The DOL and HHS notices do not specify an effective date. However, the IRS notice states that the agencies are proposing to finalize, as of April 1, 2016, the templates, instructions and related material.
Action to Take: Plan sponsors who wish to provide comments must do so by March 28, 2016.
Cheiron Observation: With comments due on March 28, and specific instructions on the template not having been provided, we do not believe that April 1 refers to the effective date April 1. Rather, it is more likely referring to when the agencies anticipate releasing the final template with instructions and the actual effective date. However, plan sponsors may want to submit comments with respect to the effectiveness of the revised template and revised uniform glossary.
The proposed revisions would make a number of changes in the content of the SBC and the uniform glossary that largely follows the revisions proposed in December 2014. Highlights of the proposed changes are as follows:
Changes to the Content of the SBC
- Revises SBC template to 5 pages from 8.
- Streamlines the questions on page 1.
- Removes headers and footers (except page numbers and the first page header).
- On page 2,
- Replaces the definitions at the top with a statement about copayments and coinsurance being after the deductible, if a deductible applies.
- Removes the line for other providers.
- Adds a reference to the website where participants can get more information about prescription drug coverage.
- Condenses and revises the explanation of rights to continued coverage and adds two yes/no questions regarding minimum essential coverage and minimum value standards.
- Adds a third example of an emergency room visit for a simple fracture.
Cheiron Observation: We hope that the statement at the top of page 2 regarding copayments and coinsurance can be modified to fit the plan terms. You may want to submit comments asking for a clarification that the header could be modified accordingly.
Changes to the Uniform Glossary
- Expands the glossary to 6 pages from 4.
- Removes hyphens from the terms Coinsurance and Copayment.
- Adds the following 16 terms: Claim, Cost Sharing, Cost-Sharing Reductions, Diagnostic Test, Formulary, Individual Responsibility Requirement, Marketplace, Maximum Out-of-Pocket Limit, Minimum Essential Coverage, Minimum Value Standard, Orthotics and Prosthetics, Premium Tax Credits, Preventive Care, Referral, Screening, and Specialty Drug.
- Revises the definitions for the following 23 terms: Allowed Amount, Appeal, Balance Billing, Coinsurance, Deductible, Durable Medical Equipment, Emergency Medical Condition, Emergency Medical Transportation, Excluded Services, Health Insurance, Home Health Care, Hospitalization, In-Network Coinsurance, Medically Necessary, Out-of-Pocket Limit, Physician Services, Plan, Prescription Drug Coverage, Primary Care Physician, Primary Care Provider, Provider, Skilled Nursing Care, and Specialist.
- Renames or consolidates three terms with revisions: Emergency Room Care has been combined with Emergency Services and called Emergency Room Care/Emergency Services, Preferred Provider has been renamed Network Provider (Preferred Provider), and Non-Preferred Provider has been renamed Out-of-Network Provider (Non-Preferred Provider).
- Modifies the last page (How You and Your Insurer Share Costs - Example) so the office visit costs are the same under all three examples.
Where to Find the Federal Register Notices and How to Submit Comments
Comments identified by "Summary of Benefits and Coverage" can be submitted as indicated below. We suggest that any comments be addressed and submitted to all three agencies:
The DOL Federal Register notice can be found at https://www.gpo.gov/fdsys/pkg/FR-2016-02-26/pdf/2016-04314.pdf. To submit comments to the DOL:
- By email: OIRA_submission@omb.eop.gov.
- Mail or Hand Delivery: Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL-EBSA, Office of Management and Budget, Room 10235, 1725 17th Street NW, Washington, DC 20503.
- And a copy to DOL at DOL_PRA_PUBLIC@dol.gov.
The HHS Federal Register notice can be found at https://www.gpo.gov/fdsys/pkg/FR-2016-02-26/pdf/2016-04318.pdf. To submit comments to HHS:
- By email: OIRA_submission@omb.eop.gov.
- Mail or Hand Delivery: OMB, Office of Information and Regulatory Affairs, Attn: CMS Desk Officer, Fax Number (202) 395-5806.
The IRS Federal Register notice can be found at https://www.gpo.gov/fdsys/pkg/FR-2016-02-26/pdf/2016-04313.pdf. Direct comments to the IRS to Carrie Holland, Director, Tax Forms and Publications, Internal Revenue Service, Room 6129, Washington, DC 20224.
Cheiron consultants can assist with the analysis of the proposed changes to the SBC for your plan.
Cheiron is an actuarial consulting firm that provides actuarial and consulting advice. However, we are neither attorneys nor accountants. Therefore, we do not provide legal services or tax advice.