As of September 23, 2012, health insurance issuers and group health plans must provide health plan participants and enrollees with information to better help them understand the plan’s benefits and coverage. The requirement to provide a summary of benefits and coverage (SBC) and uniform glossary applies for disclosures to participants and beneficiaries who enroll or re-enroll in group health coverage through an open enrollment period (including re-enrollees and late enrollees) beginning on the first day of the first open enrollment period that begins on or after September 23, 2012. For disclosures to participants and beneficiaries who enroll in group health plan coverage other than through an open enrollment period (including individuals who are newly eligible for coverage and special enrollees), these requirements apply beginning on the first day of the first plan year that begins on or after September 23, 2012. For disclosures to plans, and to individuals and dependents in the individual market, these requirements are applicable to health insurance issuers beginning on September 23, 2012.

Specifically, health insurance participants and enrollees must be provided with an SBC that summarizes, in plain language, key features of the plan, including covered benefits, cost-sharing provisions, and coverage limitations and exceptions. The SBC must be provided when potential enrollees are shopping for coverage, when they actually apply for coverage, at each plan year, and upon request. In addition, health insurance issuers and group health plans must also provide access to a glossary of common terms used in health insurance, such as “copayment” and “deductible,” with easy-to-understand definitions. The final rule implementing this new Affordable Care Act obligation was issued in February 2012.

Enrollees and policyholders must also be notified of any significant changes in coverage that will occur in the middle of the plan year at least 60 days before such changes take effect.

More information on the SBC requirement, including links to a fact sheet, sample SBC, SBC template, uniform glossary, and rules and guidance implementing this practice can be found here.

Photo credit: geotrac