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Summary of Benefits and Coverage Under Health Care Reform: What Does an Employer Need To Do This Fall?

September 19, 2012

Effective as early as this fall, regulations issued pursuant to the Patient Protection and Affordable Care Act require an employer that sponsors a group health plan to provide participants and beneficiaries with a summary of benefits and coverage (“SBC”) for each benefit package offered under the plan. In particular, the regulations require the following:

  • Participants and Beneficiaries Enrolling or Re-Enrolling During Open Enrollment Period – The regulations require a group health plan or its administrator (almost always the employer) to provide an SBC to each participant or beneficiary enrolling or re-enrolling during any open enrollment period beginning on or after September 23, 2012. The SBC must be provided on the first day of the open enrollment period. For example, if an employer’s open enrollment period begins on October 1, 2012 for coverage that takes effect on January 1, 2013, the SBC must be provided to each such participant or beneficiary on October 1, 2012.
  • Participants and Beneficiaries Enrolling Other Than During Open Enrollment Period – The regulations require a group health plan or its administrator to provide an SBC to each participant or beneficiary who enrolls at a time other than during an open enrollment period (including employees who are newly eligible for coverage and special enrollees). The SBC must be provided beginning on the first day of the first plan year beginning on or after September 23, 2012. For example, if the plan year is the calendar year, the SBC must be provided to each such participant or beneficiary beginning on January 1, 2013.

In the case of an insured plan, an employer will need to obtain the required SBC(s) from the insurance carrier. The regulations require the insurance carrier to provide the SBC(s) within seven business days following receipt of the employer’s application for coverage. This requirement takes effect on September 23, 2012.

The regulations set forth stringent guidelines as to the required form and content of an SBC and the manner in which an SBC must be distributed to a participant or beneficiary. Wolff & Samson attorneys are available to answer any questions an employer may have with regard to this new requirement.

For more information regarding the SBC requirement, including assistance with preparing the SBC, please contact:

Adam B. Cantor, Member of the Firm (Chair, Employee Benefits) | (973) 530-2020 | acantor@wolffsamson.com
David M. Hyman, Member of the Firm (Health Care) | (973) 530-2009 | dhyman@wolffsamson.com
Catherine P. Wells, Member of the Firm (Chair, Employment) | (973) 530-2051 | cwells@wolffsamson.com
Margaret O’Rourke Wood, Member of the Firm (Employment) | (973) 530-2063 | mwood@wolffsamson.com
Nicole DiMaria, Member of the Firm (Health Care) | (973) 530-2111 | ndimaria@wolffsamson.com
Denise J. Pipersburgh, Associate (Employment) | (973) 530-2090 | dpipersburgh@wolffsamson.com
William J. Cannici Jr., Associate (Health Care) | (973) 530-2183 | wcannici@wolffsamson.com