When your company offers a group health plan, there are several different notices you are required to provide to participants about their health benefits. Keeping track of the required notice requirements can be tedious and time-consuming, especially with the new Obamacare requirements, and especially for small and medium sized employers. However, failure to comply can lead to fees and penalties.
To help you properly administer your health benefits and stay compliant this year, here is a checklist with 11 key health plan notices required under ERISA, HIPAA, COBRA, and PPACA.
This section outlines 11 key health plan notices required of most group health plans. Generally speaking, the notices apply to all types of group health plans including fully-insured and self-insured group health insurance plans and defined contribution health plans (ex: Health Reimbursement Plans). However, some of the requirements vary by the size of your company and the type of health benefits you offer.
1. Notice Regarding Availability of Health Insurance Marketplaces
Employers covered by FLSA are required to provide all employees a notice about the availability of the Affordable Care Act’s Health Insurance Exchanges (Marketplaces).
2. Summary Plan Description (SPD)
The SPD is the primary vehicle for informing participants and beneficiaries about their rights and benefits under their employee benefit plans.
The SPD includes information on: Basic rights and responsibilities under ERISA, eligibility, plan benefits, and how to access benefits.
3. Plan Documents
The Plan Documents specify how the health plan is established or operated. The documents often include the latest updated SPD, latest Form 5500, trust agreement, and other instruments under which the plan is established or operated.
4. Summary of Benefits and Coverage (SBC) and Uniform Glossary
Summary of Benefits and Coverage (SBC) is a 4-page standardized document that describes the benefits of the health plan in layman's terms. The Uniform Glossary provides definitions of coverage-related terms.
5. Summary of Material Modifications (SMM) and Notice of Modification
A SMM must be provided to each participant covered under the plan when:
Changes to the health plan occur at a time other than at renewal.
A change to the health benefits affects the content of the SBC.
Information is not reflected in the most recent SBC.
Tip: The notice is required to be provided to participants at least 60 days prior to the date that the health plan change will become effective.
6. Notice of Special Enrollment Rights
Notice describing the group health plan’s special enrollment rules including the right to special enroll within 30 days of the loss of other coverage or of marriage, birth of a child, adoption, or placement for adoption.
7. Form 5500 Series Form (Annual Report) and Summary Annual Report (SAR)
Employers with 100+ employees are required to file Form 5500, and provide the Summary Annual Report (SAR) to each plan participant summarizing the Form 5500 annual report.
8. Form 720 and Patient-Centered Outcomes Research Institute (PCORI) Fee
Employers who offer a self-insured health plan (including a Healthcare Reimbursement Plan) are required to file Form 720 and pay the PCORI fee annually.
9. Employer CHIPRA Notice
The CHIPRA notice informs employees of possible premium assistance opportunities in their state, such as Medicaid, CHIP, and the premium tax credits.
10. Internal Claims and Appeals and External Review Notices
For internal claims, plans must provide notice of adverse benefit determination and notice of final internal adverse benefit determination. After an external review, the independent review organization (IRO) issues a notice of the final review decision.
11. COBRA Notices
Notice to participants and beneficiaries on the right to continue group health plan coverage after a qualifying event, including information about other coverage options (such as the Marketplaces).
Depending on the notice, and on the type of health benefits offered, it is either the employer, plan sponsor, and/or insurer who is required to prepare and distribute these notices.
The various health plan notices are due at different times during the plan year, and/or after specific triggering events.
There are numerous sample notices and templates online, often provided by the governing entity (ex: Department of Labor and IRS).
We hope this checklist of required health plan notices helps you administer your health benefits and stay compliant with existing and new regulations.