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Open Enrollment with an Eye to the Future

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Right now, most of us are focused on 2012 benefits enrollment—implementing benefit changes, preparing communications, scheduling employee meetings. This is all good. But you don’t want to forget some of the longer-term implications of the Patient Protection and Affordable Care Act (PPAC).

Of key concern are the proposed regulations for a Summary of Benefits and Coverage. Here are a few facts:

What is the Summary of Benefits and Coverage (SBC)?
The SBC (also called the “uniform summary of coverage”) is a communication that describes a medical plan’s key features and costs to help employees understand their benefit choices and to compare plans on an apples-to-apples basis. The SBC must also include a glossary of commonly used plan terms and at least three examples of how the medical plan(s) cover health expenses.

Who is responsible for these communications?
For fully-insured plans, insurance companies and group health plans are on the hook for providing the SBC. For self-insured plans, the employer is responsible for development and distribution.

When does the SBC have to be distributed?
The SBC must be provided to all new hires and as part of annual enrollment (not after an employee enrolls in a plan). At a participant’s request, the SBC must be provided within seven days. For an employee re-enrolling in a medical plan, only the SBC for their specific plan must be provided.

Are there guidelines for these communications?
Yes. You can find proposed templates and instructions on the DOL website. But remember, these are still proposed and not final.

When does this requirement take effect?
March 23, 2012, is the current compliance date. However, the government is taking public comments now on these regulations, so the date may change or compliance phased in. Stay tuned.

For additional information:

HealthCare.gov article:
http://www.healthcare.gov/news/factsheets/labels08172011a.html

EBN article:
http://ebn.benefitnews.com/news/ppaca-labor-treasury-compliance-communication-2716843-1.html