Proposed regulations help consumers understand coverage options

UPDATED: Nov. 29, 2011

Original: Aug. 25, 2011

The Departments of Health and Human Services, Labor, and Treasury released proposed regulations on Aug. 17, 2011, to help consumers understand their health coverage options and aid employers in finding the best coverage for their employees. Health insurers and group health plans must provide consumers with clear, concise and consistent information about their health plan benefits and coverage. 

The proposed regulations ensure that consumers have access to two documents that will help them understand their health insurance choices upfront and in plain English, including:

• A straightforward, standardized "Summary of Benefits and Coverage" presented in a culturally and linguistically appropriate manner. 
• A "Uniform Glossary" of terms commonly used in health insurance, such as "deductible" and "copay." 

Under the proposed rules, an insurer or group health plan must make the "Summary of Benefits and Coverage" available on paper or electronically to applicants, enrollees, policyholders, certificate holders, group health plans, and shoppers. The "Uniform Glossary" must also be made available upon request on paper or provided electronically.

• A consumer or enrollee can request a copy of the "Summary of Benefits and Coverage" and must provide it within seven days of receiving the request. 
• Enrollees who qualify for a special enrollment period must be provided the SBC within seven days of receipt of their request. 
• In the case of renewal or reissuance, if written application is required for renewal, the "Summary of Benefits and Coverage" must be provided no later than the date the materials are distributed. For automatic renewals or reissuance of coverage, the "Summary of Benefits and Coverage" must be available 30 days prior to the first day of the new policy or plan year. 

The proposed regulation was open to public comments until Oct. 21, 2011, at which time modifications may be made prior to the issuance of final regulations. 

The agencies are currently reviewing public and industry comments to the proposed rules. Final regulations are expected to be issued sometime in 2012. The final regulations will likely contain modifications to the proposed rules and will set out the agencies' detailed standards for content and appearance as well as the requirements relating to who must distribute the documents, to whom they must be distributed and when.

In the FAQs found on the U.S. Department of Labor's website regarding implementation, the department acknowledges the many comments were received addressing implementation issues, and notes that it is striving to issue a final rule as soon as possible. It clearly states that until the final rule is effective, insurance carriers and health plans will not be required to comply with the provisions of Section 2715.

Finally, the department anticipates that the final rule, which is a joint proposal from HHS, Labor and Treasury, will provide insurers and health plans with sufficient time to enable them to come into compliance with the final rule's requirements.

Blue Cross Blue Shield of Michigan will continue to monitor the regulation to determine if any changes are needed to current processes. 

The information on this website is based on BCBSM's review of the national health care reform legislation and is not intended to impart legal advice. Interpretations of the reform legislation vary, and efforts will be made to present and update accurate information. This overview is intended as an educational tool only and does not replace a more rigorous review of the law's applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. Analysis is ongoing and additional guidance is also anticipated from the Department of Health and Human Services. Additionally, some reform regulations may differ for particular members enrolled in certain programs such as the Federal Employee Program, and those members are encouraged to consult with their benefit administrators for specific details.