The Department of Labor has released proposed revisions to the Summary of Benefits and Coverage (SBC) materials and template. Final regulations were released in June of 2015, with the expectation that the new template and revised materials would be finalized in Spring of 2016 for use with plan years beginning on or after January 1, 2017.
Some of the changes to the template include the addition of a question—“Are there services covered before you meet your deductible?,” the requirement that embedded deductibles and tiered networks be disclosed, includes new coverage examples, as well as a revision to the uniform glossary to name a few.
The Department maintains the form language and formatting requirements and reiterates that the SBC must be precisely reproduced, unless there is an exception noted in the instructions. The instructions also state that “to the extent a plan’s terms that are required to be described in the SBC template cannot reasonably be described in a manner consistent with the template and instructions, the plan or issuer must accurately describe the relevant plan terms while using its best efforts to do so in a timely manner that is still as consistent with the instructions and template format as reasonably possible.”
At this time there is no specific carve out for Health Reimbursement Arrangements (HRA) and non-excepted Health Care Flexible Spending Accounts (FSA), which means that employers must continue to use the SBC format that was truly intended for insured and self-funded health plans when communicating HRA and non-excepted Health FSA details each year.
The proposed revisions are open to public comment for 30 days. Direct all written comments should be directed to Carrie Holland, Internal Revenue Service, Room 6129, 1111 Constitution Avenue NW., Washington, DC 20224.
Written comments should be received on or before March 28, 2016 to be assured of consideration. The Departments expect to finalize templates and materials on April 1, 2016.
The actual effective date of the new template will be determinant upon when the materials are officially finalized following the comment period.