HealthReformGPS is made possible through generous financial support from the RCHN Community Health Foundation. Visit them at

Departments of Labor, HHS, and Treasury issue summary of benefits and coverage FAQs

Posted on May 17, 2012 | No Comments

PDF Version
Key Developments
Editor's Comment
Implementation Briefs

The departments of Labor, Health and Human Services, and Treasury issued a set of 14 frequently asked questions (FAQs) and answers regarding implementation of the summary of benefits and coverage (SBC) provisions of the Affordable Care Act (ACA). Importantly in the FAQs, the departments announced that they would not take enforcement action against insurers in a number of circumstances for failure to fully comply with requirements that they provide a standardized SBC during the first year of applicability of the new rules.

The departments issued a final rule in February requiring insurers to use plain language in describing benefits and coverage. With the final rule, the departments released a uniform glossary of terms.

The guidance is the ninth set of FAQs posted regarding ACA compliance. This set of FAQs also addresses when plans and issuers can provide SBC electronically, circumstances that will trigger the requirement for an issuer to provide an SBC, and whether issuers are required to provide SBCs to group health plans or their sponsors that are shopping for coverage but have yet to submit an application.

No Comments

Public comments are closed.

The U.S. Department of Health and Human Services (HHS) issued a proposed rule, simultaneously released by the Internal Revenue Service (IRS) and the Department of Labor (DOL), regarding the summary of benefits and coverage (SBC) and the uniform glossary for health insurance coverage in the group and individual markets under the Affordable Care Act (ACA). The proposed rule would change disclosure requirements to help plans and individuals better understand their health coverage and allow for informed comparisons of coverage options. The proposed regulation also makes amendments to the template for the SBC, instructions, sample language, guides for coverage example calculations, and the uniform glossary.
On September 4th, the Departments of Labor, Health and Human Services, and Treasury jointly issued the sixteenth installment of their FAQs about implementing the Affordable Care Act (ACA). This particular set addressed employer notice of coverage and the 90-day waiting period limitation before employer-sponsored benefits are required to kick-in. As specifically stated in the FAQ, an employer will be considered to have satisfied the notice of coverage obligation if another entity "provides a timely and complete notice." The FAQ also stated that employers can refer to the proposed rule issued in March 2013 on compliance expectations for the 90-day waiting period limitation. A final rule will be released before January 2015.
The Center for Consumer Information and Insurance Oversight (CCIIO) provided permissible Model Language for issuers to use when notifying existing customers of the new plan options that will be available to them through the Affordable Care Act's (ACA) health insurance marketplaces. CCIIO provided several examples as to how issuers may phrase their notices, and gives issuers the flexibility to either provide the notice by itself or as part of the customer's policy renewal notice. Furthermore, issuers of qualified health plans (QHP) and non-grandfathered health plans are barred from using practices that would discourage enrollment of those with poor health statuses.
In the 15th set of Affordable Care Act (ACA) FAQs, the Internal Revenue Service (IRS) and the Employee Benefit Security Administration (EBSA) answer questions posed by the public and stakeholders to demystify the implementation of various components of the ACA. This particular set discusses annual limit waivers, stating that an alteration to a health plan or policy year will not impact the expiration of an annual limit waiver. The FAQs also indicate that IRS, EBSA and the US Department of Health and Human Services (HHS) will not issue guidance on provider nondiscrimination prior to January 1st, 2014, because the statutory language on the topic is "self-implementing." In regards to transparency reporting, the FAQs clarify that plans are not beholden to the transparency provisions of the ACA until the plans have been certified as a qualified health plan (QHP) for one benefit year.
The US Department of Labor Employee Benefits Security Administration (EBSA) published their 14th set of frequently asked questions regarding the implementation of the Affordable Care Act (ACA). One key topic covered by the FAQs addresses disclosure requirements for individual or group plan summary of benefits coverage (SBC). In regards to disclosure of minimum essential coverage and the attainment of minimum value requirements, the guidance does not make notable changes for the SBC during 2014, the second disclosure year. The FAQs also state that plans unable to alter their SBC for 2014 are permitted to use the authorized year template without penalty if they also provide a cover letter stating whether or not the minimum value requirements are met.
The Employee Benefit Securities Administration (EBSA) of the U.S. Department of Labor (DOL) and the Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS) have jointly released a Frequently Asked Questions (FAQ) document addressing multiple issues related to Affordable Care Act (ACA) implementation. Most notably, the FAQs extend the deadline by which employers must notify their employees about coverage options in the Exchanges from March 1, 2013, to sometime in "the late summer or fall of 2013, which will coordinate with the open enrollment period for Exchanges." DOL made the determination in part because they feel the notifications should coincide with HHS outreach and educational efforts and IRS guidance on Exchange Qualified Health Plan (QHP) minimum value. Furthermore...
Today the Department of Health and Human Services, the Department of Treasury, and the Department of Labor released a final rule requiring insurers to use plain language in describing health plan benefits and coverage under the Affordable Care Act (ACA). The regulations mandate health insurers and group health plans to provide concise and comprehensible information about health plan benefits and coverage to Americans with private health coverage. The new rules will also facilitate easier plan comparison for individuals and employers. The new explanations, available on or soon after September 23, 2012, will be a critical resource for the roughly 150 million Americans with private health insurance. Specifically, these rules will ensure consumers have access to two key documents that will help them understand and evaluate their health insurance choices...
Recently, Sara Rosenbaum, the Hirsh Professor of Health Law and Policy at the GW Department of Health Policy, had an opportunity to interview Phyllis Borzi, the federal official in charge of overseeing the Employee Benefits Security Administration (EBSA), for Health Reform GPS. EBSA is an agency of the United States Department of Labor responsible for administering, regulating and enforcing the provisions of Title I of the Employee Retirement Income Security Act of 1974 (ERISA), and the agency is playing an important role in the implementation of the Affordable Care Act....
Research has found that consumers have significant difficulty understanding health insurance plans. This can prevent consumers from receiving clear information regarding their health insurance plan benefits. Without a clear understanding of what their insurance covers, consumers are more likely to delay or forgo care, to make uninformed choices about treatment, and to end up with large and unexpected bills. The Affordable Care Act (ACA) will give consumers the...
The Affordable Care Act included a number of insurance market reforms designed to make health insurance more affordable and available. During consideration of the ACA, one criticism of the private insurance market was that the lack of standardization in descriptions of health insurance policies available made shopping for coverage both difficult and time consuming. The ACA included provisions designed to assist consumers in better understanding their health insurance coverage, and to assist in comparing their insurance policy with other available options. Among those provisions are requirements for plans offered in both the group and individual insurance markets to provide a summary of benefits and coverage and a uniform glossary of terms commonly used in health insurance policies.