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FAQs for Employers and Brokers

What does SBC mean?
SBC is short for Summary of Benefits and Coverage. It is a document intended to help people understand their health coverage and simplify shopping for and comparing health plans.

What is the Uniform Glossary?
The Uniform Glossary is a list of commonly used healthcare terms and their definitions designed for use with the SBC. Terms and definitions may differ from those used in other plan documents describing your coverage.

What is the purpose of the SBC and Uniform Glossary?
The SBC and Uniform Glossary are meant to help people understand their healthcare coverage and the common terms used by health plans. SBCs must be provided by all insurance companies and group health plans in a standard format and may only differ based on the specific benefits offered by a plan. This standard format will help simplify shopping for and comparing health plans.

Why is this document being issued?
The SBC is being issued because the federal government requires all healthcare insurers and group health plan sponsors to provide the document to plan participants at certain times beginning September 23, 2012. SBCs will be created for each medical plan administered by Mutual Health Services.

Group health plan sponsors must provide a copy of the SBC to each employee who is eligible for coverage under the plan. If more than one plan is offered to employees, only the SBC specific to the plan for which an employee is eligible must be provided. However, if an employee asks to see a different plan’s SBC, you must also provide it so he or she can compare plans.

Mutual Health Services will provide the SBC to group officials, who will be responsible for distributing it to employees at the required times (please see timing requirements for SBC distribution in question #8 below).

What information is included in the SBC?

The SBC includes:

  • A summary of the services covered by the plan
  • A summary of the services not covered by the plan
  • The copays and/or deductibles required by the plan, but not the premium
  • Information about members’ rights to continue coverage
  • Information about members’ appeal rights
  • Examples of how the plan will pay for certain services

What do the coverage examples in the SBC show?
The federal government requires all insurance companies and group health plans to provide two examples of services covered under the plan. The two examples provided are having a baby and managing type 2 diabetes.

The examples are not intended to show exact costs, because each person’s care will be different. Instead, the sample costs are based on national averages supplied by the Department of Health and Human Services. They are not specific to a certain geographic area or health plan.

These examples should help compare coverage between plans. The “Patient Pays” box at the bottom of each example shows how each plan offers more or less coverage for these two conditions.

Will HRA or FSA information be included on SBCs?
No. Money from a health reimbursement account (HRA) or flexible spending account (FSA) that is used to pay for out-of-pocket expenses would not be included in the coverage examples shown on an SBC. You will see the following disclaimer:

"These numbers assume that the patient does not use an HRA or FSA. If you participate in an HRA or FSA and use it to pay for out-of-pocket expenses, then your costs may be lower. For more information about your HRA or FSA, please contact your employer group."

How often will employees need to receive an SBC?

Beginning September 23, 2012, group health plan sponsors are required to provide the SBC to eligible employees and plan participants at various times:

  • When an employee is first eligible for coverage
  • During open enrollment periods, or if there is no open enrollment period, at least 30 days prior to the next plan or policy year
  • By the first day coverage starts, if the SBC changed from the version provided during open enrollment
  • After a request for special enrollment, as defined by HIPAA
  • If there is a mid-year change to the plan that affects the information in the SBC
  • Upon request

If a plan is grandfathered, is an SBC still required?
Yes. all insurers and group health plan sponsors, whether a plan is grandfathered or non-grandfathered, are required to provide the SBC to all eligible employees and plan participants.

Are any plans exempt from the requirement to provide an SBC?
An SBC is required for most health plan types. SBCs are not required if a plan, policy or benefit package is considered a “HIPAA-excepted benefit.” Some examples of HIPAA-excepted benefits are dental-only plans, vision-only plans and some flexible spending accounts (FSAs).

Health Reimbursement Accounts, or HRAs, are group health plans and are not typically considered HIPAA-excepted benefits. Plan sponsors and issuers must provide SBCs for HRA plans.

Health Savings Accounts, or HSAs, are not typically considered group health plans and therefore do not require an SBC. However, if the HSA is tied to a high-deductible health plan (HDHP), the HDHP is considered a group health plan and plan sponsors and issuers must provide an SBC for the HDHP.

How can a copy of the SBC and Uniform Glossary be requested?

  • Group officials – Contact your Mutual Health Services Account Services representative or broker to request a paper copy.
  • Brokers – Contact your Mutual Health Services Account Services representative to request a paper copy of a group’s specific SBC.
  • Group plan participants – Mutual Health Services will direct calls from a group participant who is requesting a copy of these documents to the group official.

Will there be a charge for providing the SBC?
Mutual Health Services will deliver one copy of each plan’s SBC to a group official at no charge. Additional fees may apply if a group requests other services, since it is the plan sponsor’s obligation to provide the SBC.

Can a member stop receiving the SBC?
No. Providing the SBC is required by the ACA.

What will happen if the SBC is not provided to employees/participants?
Group health plan sponsors and health insurance issuers that do not provide the SBC to their employees, participants or members may be subject to fines.

Will Mutual Health Services be compliant with the SBC requirements defined by the Affordable Care Act?
As a third-party administrator, Mutual Health Services is not subject to the SBC requirements of the ACA; however, we will assist our clients with the creation of an SBC for the plans we administer.

What is the earliest date Mutual Health Services will provide a copy of a plan’s SBC to group official?
In accordance with the ACA, we will have SBCs for current benefits available beginning September 23, 2012. The first time a group official will need to distribute an SBC to its participants depends the date of its first open enrollment period and its first plan year, as described below:

  • For participants enrolling in plans during open enrollment periods, the group official must distribute the SBC to its participants during the first open enrollment period held on or after September 23, 2012.
  • For participants enrolling at other times (including newly eligible and special enrollees), the group official will need to provide the SBC to its participants beginning with its first plan year on or after September 23, 2012.

For groups that have prescription drug plans administered through a third-party vendor, will this information be included on the SBC provided by Mutual Health Services?
If a Summary Plan Description produced by Mutual Health Services includes pharmacy benefits, the SBC will include the pharmacy benefit information.

Can a self-funded group produce its own SBC?
Yes, and in this case, Mutual Health Services will not produce and deliver SBCs to the group official.

Can a self-funded group ask Mutual Health Services to provide SBCs to its employees?
Requests from self-funded groups for Mutual Health Services to provide SBCs to their employees will be handled on a case-by-case basis.

If a group plan offers several different health plans administered by different third party administrators and carriers, can all the plans be combined on one SBC?
No. Mutual Health Services will provide SBCs only for coverage we administer. See question 17 for the Pharmacy Benefits exception.

Will Mutual Health Services customize my group’s SBC, for example with my company’s logo?
No. SBCs cannot be customized in any way other than the plan’s specific benefits.