EBSA
Final Rules
Summary of Benefits and Coverage and Uniform Glossary--Templates,Instructions, and Related Materials; and Guidance for Compliance
[ 2/14/2012]
[ PDF]
Federal Register, Volume 77 Issue 30 (Tuesday, February 14, 2012)
[Federal Register Volume 77, Number 30 (Tuesday, February 14, 2012)]
[Rules and Regulations]
[Pages 8706-8709]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-3230]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
DEPARTMENT OF LABOR
Employee Benefits Security Administration
29 CFR Part 2590
DEPARTMENT OF HEALTH AND HUMAN SERVICES
[CMS-9982-FN]
45 CFR Part 147
Summary of Benefits and Coverage and Uniform Glossary--Templates,
Instructions, and Related Materials; and Guidance for Compliance
AGENCIES: Internal Revenue Service, Department of the Treasury;
Employee Benefits Security Administration, Department of Labor; Centers
for Medicare & Medicaid Services, Department of Health and Human
Services.
ACTION: Guidance for compliance and notice of availability of
templates, instructions, and related materials.
-----------------------------------------------------------------------
SUMMARY: The Departments of Health and Human Services, Labor, and the
Treasury are simultaneously publishing in the Federal Register this
guidance document and final regulations under the Patient Protection
and Affordable Care Act to implement the disclosure for group health
plans and health insurance issuers of the summary of benefits and
coverage (SBC), notice of modifications, and the uniform glossary. This
guidance document provides guidance for compliance with section 2715 of
the Public Health Service Act and the Departments' final regulations,
including a template for the SBC, instructions, sample language, a
guide for coverage example calculations, and the uniform glossary.
FOR FURTHER INFORMATION CONTACT: Amy Turner or Heather Raeburn,
Employee Benefits Security Administration, Department of Labor, at
(202) 693-8335; Karen Levin, Internal Revenue Service, Department of
the Treasury, at (202) 622-6080; Jennifer Libster or Padma Shah,
Centers for Medicare & Medicaid Services, Department of Health and
Human Services, at (301) 492-4222.
Customer Service Information: Individuals interested in obtaining
information from the Department of Labor concerning employment-based
health coverage laws may call the EBSA Toll-Free Hotline at 1-866-444-
EBSA (3272) or visit the Department of Labor's Web site (http://www.dol.gov/ebsa). In addition, information from HHS on private health
insurance for consumers can be found on the Centers for Medicare &
Medicaid Services (CMS) Web site (http://www.cms.hhs.gov/HealthInsReformforConsume/01_Overview.asp) and information on health
reform can be found at http://www.healthcare.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction
The Departments of Health and Human Services (HHS), Labor, and the
Treasury (the Departments) are taking a phased approach to issuing
regulations and guidance implementing the revised Public Health Service
Act (PHS Act) sections 2701 through 2719A and related provisions of the
Patient Protection and Affordable Care Act (Affordable Care Act).\1\
Section 2715 of the PHS Act directs the Departments to develop
standards for use by a group health plan and a health insurance issuer
in compiling and providing a summary of benefits and coverage (SBC)
that ``accurately describes the benefits and coverage under the
applicable plan or coverage.'' Section 2715 of the PHS Act also directs
the Departments to provide for the development of ``standards for the
definitions of terms used in health insurance coverage.'' The statute
directs the Departments, in developing such standards, to ``consult
with the National Association of Insurance Commissioners'' (referred to
in this guidance document as the ``NAIC''), ``a working group composed
of representatives of health insurance-related consumer advocacy
organizations, health insurance issuers, health care professionals,
patient advocates including those representing individuals with limited
English proficiency, and other qualified individuals.''
---------------------------------------------------------------------------
\1\ The Affordable Care Act also adds section 715(a)(1) to the
Employee Retirement Income Security Act (ERISA) and section
9815(a)(1) to the Internal Revenue Code (the Code) to incorporate
the provisions of part A of title XXVII of the PHS Act into ERISA
and the Code, and make them applicable to group health plans, and
health insurance issuers providing health insurance coverage in
connection with group health plans.
---------------------------------------------------------------------------
After consultation with the NAIC,\2\ on August 22, 2011, the
Departments published proposed regulations to implement PHS Act section
2715,\3\ as well as a companion document that proposed an SBC template
(with instructions, sample language, and a guide for coverage examples
calculations to be used in completing the SBC template) and a uniform
glossary.\4\ HHS also published on its Web site (at http://cciio.cms.gov, and accessible via hyperlink from www.dol.gov/ebsa/healthreform) the coding and pricing information necessary to perform
calculations for the three proposed coverage examples. Comments were
solicited on these materials.
---------------------------------------------------------------------------
\2\ A summary of the NAIC's work can be found at 76 FR 52476-77,
August 22, 2011.
\3\ 76 FR 52442, August 22, 2011.
\4\ 76 FR 52475, August 22, 2011.
---------------------------------------------------------------------------
Final regulations under PHS Act section 2715 are being published
elsewhere in this issue of the Federal Register (final regulations).
This guidance document provides guidance for compliance with PHS Act
section 2715 and the final regulations, including information on how to
obtain the SBC template (with instructions and sample language for
completing the template) and the uniform glossary. These items are
displayed at www.dol.gov/ebsa/healthreform and www.cciio.cms.gov.
[[Page 8707]]
II. Guidance
A. Documents Authorized for the First Year of Applicability
This guidance document authorizes an SBC template (with
instructions, samples, and a guide for coverage example calculations to
be used in completing the SBC template), and the uniform glossary, to
comply with the disclosure requirements of PHS Act section 2715,
pursuant to paragraph (a)(3) of the final regulations.\5\ These
documents are authorized with respect to group health plan coverage and
group and individual health insurance coverage for SBCs and uniform
glossaries provided with respect to coverage beginning before January
1, 2014 (referred to in this guidance document as ``the first year of
applicability'').
---------------------------------------------------------------------------
\5\ This guidance makes references to various paragraphs of the
final regulations. The final regulations are codified at 26 CFR
54.9815-2715, 29 CFR 2590.715-2715, and 45 CFR 147.200. However, for
simplicity, this guidance refers only to the relevant paragraph of
the three regulations instead of using three parallel, full
citations.
---------------------------------------------------------------------------
The materials described in this guidance document are authorized by
the Departments for the first year of applicability only; the
Departments intend to issue updated materials for later years.
Specifically, these documents do not provide language to comply with
paragraph (a)(2)(i)(G) of the final regulations, requiring a statement
in the SBC about whether a plan or coverage provides minimum essential
coverage and whether the plan's or coverage's share of the total
allowed costs of benefits provided under the plan or coverage meets
applicable minimum value requirements, because the final regulations do
not require this material to be included in the first year of
applicability. In addition, the Departments recognize that, beginning
January 1, 2014, new market reforms \6\ will take effect, which are
expected to prompt additional changes to the SBC (for example, annual
limits will no longer be permissible).
---------------------------------------------------------------------------
\6\ See Subpart I of Part A of Title XXVII of the PHS Act.
---------------------------------------------------------------------------
Finally, the documents described in this guidance document contain
information for two coverage examples--having a baby (normal delivery)
and managing type 2 diabetes (routine maintenance of a well-controlled
condition). This approach differs from the documents published in
connection with the proposed regulations, which included three coverage
examples (relating to having a baby (normal delivery), breast cancer,
and diabetes). The Departments received many comments asserting that
the necessary calculations for the coverage examples would be costly
and complicated. Commenters asked the Departments to add flexibility in
use of the coverage examples and expressed concerns about misleading
consumers about the costs of the health care services associated with
the coverage examples. The Departments also received a number of
comments that expressed concern about the high variability in treatment
plans for patients with breast cancer and diabetes. Therefore, the
Departments have modified the coverage examples requirements and will
continue to evaluate these coverage examples, as well as others
suggested by commenters.\7\ Consumer testing performed on behalf of the
NAIC \8\ demonstrated that the coverage examples facilitated
individuals' understanding of the benefits and limitations of a plan or
policy and helped them make more informed choices about their options.
Such testing also showed that individuals were able to comprehend that
the examples were only illustrative. Additionally, while some plans
provide useful coverage calculators to their enrollees to help them
make health care decisions, they are not uniform across all plans and
most are not available to shoppers, making it difficult for consumers
to make coverage comparisons. Future guidance will add coverage
examples and make other changes (including those described above) for
SBCs required to be provided after the first year of applicability.
---------------------------------------------------------------------------
\7\ Examples suggested by comments included prostate cancer,
colorectal cancer, hypertension, heart attack, stroke, major
depression, and chronic kidney disease, among others.
\8\ A summary of the focus group testing done by America's
Health Insurance Plans is available at: http://www.naic.org/documents/committees_b_consumer_information_101012_ahip_focus_group_summary.pdf, a summary of the focus group testing done
by Consumers Union on the coverage examples is available at: http://prescriptionforchange.org/wordpress/wp-content/uploads/2011/08/A_New_Way_of_Comparing_Health_Insurance.pdf.
---------------------------------------------------------------------------
In addition to the materials described in this guidance document,
HHS is providing (at http://cciio.cms.gov, also accessible via
hyperlink from www.dol.gov/ebsa/healthreform) the specific information
necessary to simulate benefits covered under the plan or policy for the
coverage example portion of the SBC (including relevant medical items
and services, dates of service, billing codes, and allowed charges),
pursuant to paragraph (a)(2)(ii) of the final regulations. This
information must be used for SBCs provided during the first year of
applicability. Future guidance will make changes to this information
for SBCs required to be provided after the first year of applicability.
B. Appearance
The Departments' 2011 proposed regulations would have required that
a group health plan and a health insurance issuer provide an SBC as a
stand-alone document. This requirement was eliminated with respect to
group health plan coverage in the final regulations (as discussed more
fully in the preamble to the final regulations). Instead, the final
regulations provide for the Secretaries to issue guidance for the form
of the SBC. Consistent with the authority set forth in paragraph (a)(3)
of the final regulations, with respect to group health plan coverage,
the Departments authorize the SBC to be provided either as a stand-
alone document or in combination with other summary materials (for
example, a summary plan description), if the SBC information is intact
and prominently displayed at the beginning of the materials (such as
immediately after the Table of Contents in a summary plan description).
For health insurance coverage provided in the individual market, the
SBC must be provided as a stand-alone document. The Departments will
review and monitor SBCs provided as part of other plan materials and
may modify their guidance as to appearance for SBCs required to be
provided after the first year of applicability in response to plan and
issuer practices.
The NAIC stated in its December 2010 transmittal letter that the
NAIC working group intentionally designed the layout and color of the
SBC template. The Departments noted in the document published
contemporaneously with the proposed regulations, however, that color
printing may be costly and proposed that a plan or issuer would be
compliant with the requirement to provide the SBC if it used either the
color version as recommended by the NAIC or the grayscale version. The
Departments are retaining that approach in this guidance document, and
will allow the SBC to be provided either in color or grayscale.
C. Special Rule
For group health plans and health insurance issuers in the group
and individual markets, use of the full SBC template authorized by this
guidance document is required, including for the first year of
applicability. To the extent a plan's terms that are required to be
described in the SBC template cannot
[[Page 8708]]
reasonably be described in a manner consistent with the template and
instructions, the plan or issuer must accurately describe the relevant
plan terms while using its best efforts to do so in a manner that is
still consistent with the instructions and template format as
reasonably possible. Such situations may occur, for example, if a plan
provides a different structure for provider network tiers or drug tiers
than is contemplated by the template and these instructions, if a plan
provides different benefits based on facility type (such as hospital
inpatient versus non-hospital inpatient), in a case where a plan is
denoting the effects of a related health flexible spending arrangement
or a health reimbursement arrangement, or if a plan provides different
cost sharing based on participation in a wellness program. The
Departments intend to update the template instructions for SBCs
required to be provided after the first year of applicability. Whether
the need for a special rule becomes moot in light of additional
instructions, or whether the need continues to exist, will be addressed
in future guidance.
D. Language
PHS Act section 2715 requires group health plans and health
insurance issuers to provide the SBC in a culturally and linguistically
appropriate manner. Paragraph (a)(5) of the final regulations provides
that a plan or issuer satisfies this requirement by following the rules
for providing claims and appeals notices in a culturally and
linguistically appropriate manner under PHS Act section 2719, and
paragraph (e) of its implementing regulations, as applied to the
SBC.\9\ Under those rules, plans and issuers must provide notices in a
culturally and linguistically appropriate manner when 10 percent or
more of the population residing in the claimant's county are literate
only in the same non-English language, as determined based on American
Community Survey data published by the United States Census Bureau. At
the time of publication of this guidance document, 255 U.S. counties
(78 of which are in Puerto Rico) meet this threshold. The overwhelming
majority of these are Spanish; however, Chinese, Tagalog, and Navajo
are present in a few counties, affecting five states (specifically,
Alaska, Arizona, California, New Mexico, and Utah).\10\
---------------------------------------------------------------------------
\9\ See 75 FR 43330 (July 23, 2010), as amended by 76 FR 37208
(June 24, 2011).
\10\ The Departments publish guidance on their Web site with a
list of the counties that meet this threshold. This information is
available at www.dol.gov/ebsa/healthreform and http://cciio.cms.gov/.
---------------------------------------------------------------------------
To help plans and issuers meet the language requirements of
paragraph (a)(5) of the final regulations, as requested by commenters,
HHS will provide (at http://cciio.cms.gov, also accessible via
hyperlink from www.dol.gov/ebsa/healthreform) written translations of
the SBC template, sample language, and uniform glossary in Spanish,
Tagalog, Chinese, and Navajo. HHS may also make these materials
available in other languages to facilitate voluntary distribution of
SBCs to other individuals with limited English proficiency.
III. Templates, Instructions, and Related Materials
As stated above, this guidance document authorizes documents to
comply with the disclosure requirements of PHS Act section 2715,
pursuant to paragraph (a)(3) of the final regulations. The Departments
received comments in response to the previous guidance and proposed
templates, instructions, and related materials.\11\ These comments
addressed specific issues related to the SBC template, instructions,
samples, and the uniform glossary. After consideration of these
comments, the Departments are announcing the availability of the
following documents, available at http://cciio.cms.gov and www.dol.gov/ebsa/healthreform ebsa/healthreform:
---------------------------------------------------------------------------
\11\ 76 FR 52475 (August 22, 2011).
---------------------------------------------------------------------------
1. SBC template. The document is available in modifiable format (MS
Word), as suggested by commenters for ease of use.
2. Sample completed SBC. This document was completed using
information for sample health coverage and provides a general
illustration of a completed SBC.
3. Instructions. For assistance in completing the SBC template,
separate instructions are available for group health coverage and for
individual health insurance coverage.
4. Why This Matters language. The SBC instructions include language
that must be used when completing the ``Why This Matters'' column on
the first page of the SBC template. Two language options are provided
depending on whether the answer in the applicable row is ``yes'' or
``no'', according to the terms of the plan or coverage.
5. Coverage examples. This guidance document, together with
information provided in Microsoft Excel format by HHS at http://cciio.cms.gov and accessible via hyperlink from www.dol.gov/ebsa/healthreform), provides all the information necessary to perform the
coverage example calculations.
6. Uniform glossary. The uniform glossary of health coverage and
medical terms may not be modified by plans or issuers.
In revising the proposed template, instructions, and other
materials, the Departments made several changes that were suggested in
comments. Some of these changes were made at the request of self-
insured plans, which commented that terminology in the SBC template was
appropriate only for insured coverage. For example, terms such as
``policy'' and ``insurer'' have been changed to ``coverage'' and
``plan'', respectively. In addition, because rights to continue
coverage vary based on many factors (including plan size, whether the
plan is insured or self-insured, and State law), the description of
rights to continue coverage has been modified to reference Federal and
State protections more generally and include contact information for
questions. Additionally, the data element in the proposed template
labeled as ``Policy Period'' has been revised to be labeled as
``Coverage Period.'' The instructions for this data element have also
been updated, to allow for situations in which there is no known end
date to the coverage period when the SBC is prepared, and for
situations in which an updated SBC is being provided to satisfy the
requirements of paragraph (b) of the final regulations, relating to
notice of a modification. The Departments also revised the disclaimer
language at the beginning of the uniform glossary, to make clear that
the glossary is intended to be educational in nature and that the
definitions contained in the glossary may not be the same as the
definitions used by a particular plan or issuer.
Certain changes were also made to the SBC template and instructions
for completing the template to conform to changes made in the final
regulations. The final regulations eliminated premiums from the
required content for the SBC document. Therefore, the row for
communicating premium information has been removed from the SBC
template document and the instructions for completing this section have
also been removed. Additionally, language was added to the instructions
to address expatriate plans and policies. Specifically, the new
instruction allows an expatriate plan or policy to include a reference
on the SBC template in the ``Other Covered Services'' box regarding
where to find information about coverage provided outside of the United
States.
Additional flexibility was also added to the instructions for
completing the
[[Page 8709]]
SBC template. The instructions specify that, to the extent a plan's
terms that are required to be described in the SBC template cannot
reasonably be described in a manner consistent with the template and
instructions, the plan or issuer must accurately describe the relevant
plan terms while using its best efforts to do so in a manner that is
still as consistent with the instructions and template format as
reasonably possible.
The Departments also reduced the number of coverage examples
required for SBCs issued during the first year of applicability to two
examples, having a baby (normal delivery) and managing type 2 diabetes
(routine maintenance of a well-controlled condition). The breast cancer
example has been removed from the template and HHS will be providing
treatment and reimbursement information only to complete the coverage
examples relating to having a baby and managing diabetes. Additionally,
the Departments modified some of the language to clarify that the
coverage examples are not intended to demonstrate costs for an actual,
specific person (for example the ``You Pay'' language was changed to
``Patient Pays'').
Modifications were also made to the benefits scenarios. First, the
underlying benefits scenarios were modified to more accurately reflect
current accepted standards of care. For example, the proposed maternity
scenario included two ultrasounds during the early stages of pregnancy,
which is not necessary for a routine pregnancy, so the final scenario
includes one ultrasound at 20 weeks. In addition, the final maternity
scenario no longer includes some services that are clinically
appropriate, but not clinically required, such as circumcision. In the
proposed diabetes scenario, the metformin dosage was 1000 mg twice
daily, which may not be appropriate for well-controlled type 2
diabetes. The final scenario now states that metformin dosage is 500 mg
twice daily. In addition, the proposed diabetes scenario included two
podiatrist office visits, which has been reduced to one annual visit,
which is clinically appropriate for well-controlled type 2 diabetes.
The pricing data in both scenarios (allowed amounts) has been refined
to more closely reflect reimbursement rates in the private health
insurance markets. The benefits scenario has also been updated to
reflect correct coding practices, and HHS is now providing both ICD-9
and ICD-10 codes for the maternity scenario, in anticipation of the
October 1, 2013 transition to ICD-10.
IV. Paperwork Reduction Act
According to the Paperwork Reduction Act of 1995 (Pub. L. 104-13)
(PRA), no persons are required to respond to a collection of
information unless such collection displays a valid OMB control number.
The Departments note that a Federal agency cannot conduct or sponsor a
collection of information unless it is approved by OMB under the PRA,
and displays a currently valid OMB control number, and the public is
not required to respond to a collection of information unless it
displays a currently valid OMB control number. See 44 U.S.C. 3507.
Also, notwithstanding any other provisions of law, no person shall be
subject to penalty for failing to comply with a collection of
information if the collection of information does not display a
currently valid OMB control number. See 44 U.S.C. 3512.
This document relates to the information collection request (ICR)
contained in final regulations titled ``Summary of Benefits and
Coverage and the Uniform Glossary,'' which is published elsewhere in
this issue of the Federal Register. For a discussion of the hour and
cost burden associated with the ICR, please see those final
regulations.
Steven T. Miller,
Deputy Commissioner for Services and Enforcement, Internal Revenue
Service.
Signed this 7th day of February 2012.
Phyllis C. Borzi,
Assistant Secretary, Employee Benefits Security Administration,
Department of Labor.
Dated: February 6, 2012.
Marilyn Tavenner,
Acting Administrator, Centers for Medicare & Medicaid Services.
Dated: February 6, 2012.
Kathleen Sebelius,
Secretary, Department of Health and Human Services.
[FR Doc. 2012-3230 Filed 2-9-12; 11:15 am]
BILLING CODE 4830-01-P; 4120-01-P
|
|