Starting September 23, 2012, health insurance issuers and group health plans will be required to provide eligible participants with an easy-to-understand summary about a health plan’s benefits and coverage. The new regulation is intended to help individuals better understand their health insurance options.
Overview
Also known as the "four-page summary", the Summary of Benefits and Coverage (SBC) is a short document that is supposed to describe the benefits of health plans in layman's terms, relying heavily on "plain language" and charts reminiscent of the "nutrition facts" charts on the sides of cereal boxes and other foods. The purpose of the SBC is for beneficiaries to compare insurance coverage at a glance instead of wading through pages of legalese.
All insurance companies and group health plans (including HRAs) will use the same standard SBC form to help consumers compare health plans. Eligible plan participants will have the right to receive the SBC when shopping for or enrolling in coverage or by requesting a copy from the issuer or group health plan.
HRAs and SBCs
Unfortunately, the standard SBC template provided by HHS does not work well for HRAs. This is because the SBC template was designed for major medical health insurance plans.
In response to these concerns, HHS has indicated a good-faith effort should be made to modify the SBC for HRAs. In other words, HRA SBCs should be designed keeping the the intent of the regulation in mind. That is, giving participants a simple way to view and understand their HRA benefits.
For example, the Zane Product Team has created an SBC for HRAs that embraces this intent. Automatically generated based on the employer’s HRA plan design, the SBC will provide participants with a simple explanation of how their HRA works. In the spirit of the intent of the regulation, slight modifications were made to maximize the SBC impact for the HRA participant.
While HHS is displaying leniency on requiring HRAs to include the SBC, Zane Benefits customers now have full access to the SBC.
