New Federal FAQ Released to Clarify Summary of Benefits and Coverage (SBC) Mandate

The embattled healthcare reform law requires employers who sponsor healthcare coverage plans to provide employees with summaries of coverage for all plans that begin on or after September 23, 2012. Documents must be provided during open enrollment. Key points touched upon by the FAQ include:

• One SBC will suffice in lieu of multiple documents for employee-only, employee-plus-spouse, and family coverages. However, when adding multiple options to a single SBC, example coverages must refer specifically to employee-only situations.
• If a coverage sponsor contracts a vendor to distribute SBCs to employees, the sponsors is not held responsible for any penalties incurred due to vendor negligence as long as the vendor’s activities are regularly monitored by the sponsor, the sponsor corrects any problems, and the sponsor informs employees of those problems.
• New hires must receive an SBC during initial enrollment and regular employees must receive the document during open enrollment. Also, a new SBC must be distributed to employees if the plan experiences any changes that must be reflected on an SBC. The distribution of an SBC is also required in the event of a worker request for the document.
• Employee beneficiaries who are qualified for COBRA must receive an SBC
• Minor adjustments may be made to the format of the SBC.