Health Plans Have an Added Mandatory Disclosure under ERISA

Posted by Robert Ellerbrock on May 14, 2012

Ellerbrock_Robert color.jpgSummary of Benefits and Coverage.

Health care reform expands ERISA's disclosure requirements by requiring that group health plans provide a summary of benefits and coverage (“SBC”) to plan participants and beneficiaries before enrollment or re-enrollment. The primary purpose of the SBC is to enable participants to compare coverage options easily and to help them better understand their health benefits.  The SBC must accurately describe the benefits and coverage available to the participant or beneficiary under the applicable plan. This SBC requirement applies in addition to the SPD and SMM requirements already in place.

On March 19, 2012, the Internal Revenue Service, Department of Labor, and Health and Human Services  jointly issued a set of Frequently Asked Questions (“FAQs”) regarding the final regulations that were issued on February 14, 2012, regarding the SBC.  The requirements are generally effective with open enrollment periods that begin on or after September 23, 2012.  While the agencies did not delay the effective date, the FAQs make it clear that they are focusing on helping plans become compliant, rather than imposing penalties.  Specifically, Q/A-2 provides that no penalties will apply during the first year of applicability to those working diligently and in good faith to provide the required SBC content in an appearance consistent with the final regulations.

While the FAQs provide helpful guidance with respect to the SBC requirements, the basic requirements, including the effective date, are largely unchanged from the final regulations.  For a sample SBC, go to the DOL website.   Remember, the plan sponsor is responsible for ensuring distribution of the SBCs at open enrollment, automatic enrollment, special enrollment (e.g., birth of a baby, COBRA event), and upon request. 

Federal Agencies Delay Automatic Enrollment for Group Health Plans

Posted by Dana Thrasher on February 20, 2012

iStock_nowlater.jpgRecall that the Patient Protection and Affordable Care Act (“PPACA”) – the health care reform legislation passed in 2010 – originally required that group health plans implement automatic enrollment in 2014.  The Internal Revenue Service, Department of Labor and Department of Health and Human Services have jointly issued, in the form of “Frequently Asked Questions” or “FAQs,” guidance that delays the implementation of the group health plan automatic enrollment requirement.  Employers (to whom the Fair Labor Standards Act applies and with more than 200 full-time employees) have reprieve regarding the original 2014 deadline until the DOL issues final regulations that provide automatic enrollment guidance.

The FAQs detail issues regarding the requirement for employers to provide coverage to full-time employees or be subject to a penalty assessment (the “employer shared responsibility provisions”).  The FAQs also provide guidance on how employers will determine whether employees are “full time employees” and how to use W-2 income rather than household income to determine whether coverage is “affordable coverage.”  The FAQs provide that the agencies will issue further guidance on the coordination of the employer shared responsibility provisions and the 90-day waiting period limitation (and even more specifically, the application of the waiting period limitation to part-time and seasonal employees).

This guidance provides specific examples that will assist companies in preparing for future compliance.  The agencies are accepting public comments on the guidance through April 9, 2012. 

FREE Contraceptives for Women? No Co-Pay for Women's Preventive Health Care

Posted by Robert Ellerbrock on August 03, 2011

The Patient Protection and Affordable Care Act of 2010 (PPACA) required health plans to cover services listed in the HHS comprehensive list of preventive services at no cost to patients.  Just this past August 1st, as part of an expansion of coverage for women’s preventive care under the PPACA, the U.S. Department of Health and Human Services (HHS) mandates that the following soon to be co-pay free:  

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  • well-woman visits;
  • screening for gestational diabetes;
  • human papillomavirus (HPV) DNA testing for women 30 years and older;
  • sexually-transmitted infection counseling;
  • human immunodeficiency virus (HIV) screening and counseling;
  • breastfeeding support, supplies, and counseling;
  • domestic violence screening and counseling; and
  • FDA-approved contraception methods and contraceptive counseling.

 

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