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HHS Addresses SBC Template Applicability Dates and Coverage Example Values
Practical Law Legal Update w-002-7662 (Approx. 4 pages)
HHS Addresses SBC Template Applicability Dates and Coverage Example Values
by Practical Law Employee Benefits & Executive Compensation
| Published on 11 Jul 2016 • USA (National/Federal) |
The Department of Health and Human Services (HHS) issued Q&As that address the applicability dates of the final SBC template and related materials for health plans and insurers with and without an annual open enrollment period. The Q&As also clarify how to complete the SBC coverage example involving treatment of a simple fracture.
On July 8, 2016, HHS issued Q&A guidance addressing the applicability dates of the final summary of benefits and coverage (SBC) template and related materials. In April 2016, the Departments of Labor (DOL), HHS, and Treasury (the Departments) finalized changes to the SBC template, a sample completed template, instructions, and related materials (including the uniform glossary) for use in completing SBCs, as required under the Affordable Care Act (ACA) (see Legal Update, Final SBC Guidance Includes Additional Coverage Example).
The final SBC Instruction Guide provides a two-part applicability timetable regarding the SBC template and related materials that were issued in April 2016. Health plans and insurers with an annual open enrollment period must use the final SBC template and related materials beginning on the first day of the first open enrollment period beginning on or after April 1, 2017 (regarding coverage for plan years beginning on or after that date). For plans and insurers that do not use an annual open enrollment period, the SBC template and related documents must be used beginning on the first day of the first plan year that begins on or after April 1, 2017.
The Q&As reiterate this two-part timetable and also indicate that qualified health plans (QHPs) offered through the ACA exchange must use the SBC template issued in April 2016 during the 2018 open enrollment period, which runs from November 1, 2017 through January 31, 2018 (see Article, Health Insurance Exchange and Related Requirements Under the ACA).
Form Review of SBCs
The Q&As also address SBC form review in states where SBC enforcement is performed by HHS directly or, alternatively, the individual states. For states in which HHS conducts direct enforcement:
- HHS categorizes SBCs as forms.
- SBCs based on the template required to be used starting in 2017 should be submitted for review at least 60 days before use, as with other forms.
According to HHS, if an individual state (as opposed to HHS) is enforcing the SBC requirements, then an insurer should adhere to the governing state guidelines for state enforcement activity regarding SBCs. HHS recognized that state standards regarding SBC review may vary. For example, some states:
- Review SBCs as part of their form review.
- Categorize SBCs as marketing materials.
Completing SBC Coverage Examples
The Q&As also address the values that health plans and insurers should enter in the "Plans and Benefits" template for the third coverage example, treatment of a simple fracture (see Practice Note, Summaries of Benefits and Coverage Under the ACA: Content: Coverage Examples and Related Documents). For now, and until further notice, insurers should enter "$0" (as a default) on the Plans and Benefits template for each field under the third coverage example, which addresses treatment of a simple fracture. Until further notice, health plans and insurers may continue to use the coverage example calculator approved for the 2016 plan year to calculate data for the SBC scenarios "Having a Baby" and "Managing Diabetes" (that is, the first two coverage examples).
Practical Impact
The government presumably will update this guidance when more accurate values for the simple fracture coverage are available, but plans and insurers may enter the default values (as indicated above) for the time being.