SUMMARY OF BENEFITS AND COVERAGE (SBC) REQUIREMENT INTO EFFECT ON SEPTEMBER 23, 2012

03/05/2012

As reported from www.hhs.gov, a rule was announced today that health plans and insurers must provide consumers with an “SBC,” clear, consistent and comparable summary information about their health plan benefits and coverage.

After an outcry from the insurance industry prompted a brief delay, the new medical plan explanations will need to be available on September 23, 2012 exactly two years after many of The Patient Protection and the Affordable Care Act (PPACA) provisions went into effect. The HHS hopes that the SBCs will be a critical resource for the roughly 150 million Americans with private health insurance.

According to HHS Secretary Kathleen Sebelius, “(The SBC) will give consumers a new edge in deciding which plan will best suit their needs and those of their families.”

Consumers will essentially have access to two key documents:

  • A 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.”

All health plans and insurers will provide an SBC to enrollees and prospective enrollees at key times during the enrollment process, such as upon initial enrollment and each open enrollment.

A key feature of the SBC is a new, standardized plan comparison tool called “coverage examples.” The coverage examples illustrate sample medical situations and describe how much coverage the plan will provide in an event such as having a baby or managing Type II diabetes. These examples, though panned as being potentially inaccurate and incomplete among industry experts, are meant to help consumers understand and compare what they would have to pay for given medical scenarios under each plan they are considering.

This finalizes the proposed rules put forth in August of 2011. Input was received from the National Association of Insurance Commissioners (NAIC) and a group composed of health insurance-related consumer advocacy organizations, health insurers, health care professionals and patient advocates.

To view the template for the Summary of Benefits and Coverage and the glossary, visit: http://cciio.cms.gov/resources/other/index.html#sbcug or http://www.ofr.gov/inspection.aspx
For more information on the rules announced today, visit:
http://www.healthcare.gov/news/factsheets/2011/08/labels08172011a.html

3/22/12 UPDATE:More Clarification Released on the Summary of Benefits and Coverage (SBC) and Uniform Glossary of Terms

For more information about how the SBC requirement contact WGA’s Health Reform Advisory Team at healthreform@wgains.com with any questions, or check out WGA’s Health Reform Advisory Corner.