On April 6, 2016, the Department of Labor (DOL), Department of Health and Human Services (HHS), and the Internal Revenue Service (IRS), (collectively, the "agencies"), issued a new template for the Summary of Benefits and Coverage (SBC) and a new uniform glossary. This alert summarizes the key changes, which are generally effective for coverage beginning on and after April 1, 2017.

Action Needed Now:

Plan sponsors should familiarize themselves with the new SBC template and uniform glossary. Those who are responsible for issuing SBCs should understand when the new template and uniform glossary are applicable to their plans.

Cheiron Observation: The agencies did not address use of the new SBC and uniform glossary prior to April 1, 2017. Typically where earlier use is encouraged, that is explicitly stated.

Background:

The Affordable Care Act (ACA) requires group health plans and health insurance issuers offering group or individual health insurance coverage to issue an SBC that "accurately describes plan benefits or coverage." In addition, they must make a uniform glossary available to participants and beneficiaries.

In February 2016, the agencies released (for comment) proposed revisions to the SBC template and the uniform glossary. The proposed SBC included revisions to the statements concerning whether the health plan provides minimum essential coverage or meets the minimum value standard under the ACA. The proposed SBC was shorter and included a third example. The proposed uniform glossary included many new terms and revisions to the existing terms. The agencies have now finalized the revisions.

The April 2016 Updated SBC Template and Uniform Glossary:

• The updated SBC template and uniform glossary follow closely the proposed changes released in February. These changes are summarized in the Cheiron Health Alert of March 11, 2016, which can be found at this link.
• The Updated Summary of Benefits and Coverage (SBC) Template & Guide:
  • Standard Format (DOC)
  • Accessible Format (PDF)
  • Instructions for Completing the SBC--Group Health Plan Coverage (PDF)
• Additional Materials: Additional materials and supporting documents relating to the updated template are at this link.
• The Updated Uniform Glossary:
  • English (PDF)

Applicability Dates:

• Plans with Open Enrollment: For health plans and issuers that maintain an annual open enrollment period, the April 2016 updated SBC template, uniform glossary, and associated documents are required to be used beginning on the first day of the first open enrollment period that begins on or after April 1, 2017.

• Plans without Open Enrollment: For health plans and issuers that do not use an annual open enrollment period, the April 2016 updated SBC template, uniform glossary, and associated documents are required to be used beginning on the first day of the first plan year (or, in the individual market, policy year) that begins on or after April 1, 2017.

Cheiron health consultants can assist plan sponsors with the review and implementation of the finalized SBC template and uniform glossary. Plans and issuers with questions about completing the SBC may also contact the Department of Health and Human Services at SBC@cms.hhs.gov or the Department of Labor at 866-444-EBSA (3272) or www.askebsa.dol.gov.

Cheiron is an actuarial consulting firm that provides actuarial and consulting advice. However, we are neither attorneys nor accountants. Accordingly, we do not provide legal services or tax advice.