CHA News Article

Final Rule Aims to Increase Transparency for Consumers Shopping for Health Insurance Coverage

Three federal departments — Health and Human Services, Labor and Treasury ­— have collectively released final regulations for the summary of benefits and coverage (SBC) and the uniform glossary for group health plans and health insurance coverage in the group and individual markets under the Affordable Care Act (ACA). The final regulations are designed to improve consumers’ access to important plan information so they can make informed choices when shopping for and renewing coverage, as well as to provide clarifications that will make it easier for health insurance issuers and group health plans to comply with the requirement to provide the information.

The departments anticipate the new template and associated documents will be finalized by January 2016, and that it will apply to coverage that would renew or begin on the first day of the first plan year (or, in the individual market, policy year) that begins on or after Jan. 1, 2017 — including for coverage beginning on or after Jan. 1, 2017, for which open enrollment occurs in the fall of 2016. The final rule is attached and is scheduled to be published in the Federal Register on June 16.

Key policies in the final rule include:

Provision to Require Online Access to Individual Underlying Policy or Group Certificate

The final regulations clarify that, under Section 2715(b)(3)(I) of the Public Health Service Act, as added by the ACA, issuers must include a web address where a copy of the actual individual coverage policy or group certificate of coverage can be reviewed and obtained. The regulations also require these documents to be easily available to individuals, plan sponsors, and participants and beneficiaries shopping for coverage prior to submitting an application for coverage. For the group market only, because the actual certificate of coverage is not available until after the plan sponsor has negotiated the terms of coverage with the issuer, an issuer is permitted to satisfy this requirement for plan sponsors by posting a sample group certificate of coverage for each applicable product. After the actual certificate of coverage is executed, it must be easily available to plan sponsors, participants and beneficiaries via a web address.

Provisions to Reduce Unnecessary Duplication  

The final regulations aim to prevent unnecessary duplication when a group health plan utilizes a binding contractual arrangement where another party assumes responsibility to provide the SBC; where a group health plan uses two or more insurance products provided by separate issuers to insure benefits with respect to a single group health plan; and where the SBC for student health insurance coverage is provided by another party, such as an issuer that provides coverage for student enrollees and covered dependents of an institution of higher education. These provisions are consistent with prior guidance issued by the departments.

Provision to Require Certain Disclosures by QHP Issuers

The ACA and current implementing regulations already apply to qualified health plan (QHP) issuers offering coverage for abortion services, for which public funding is prohibited through an individual marketplace, and require those issuers to notify consumers of such coverage at the time of enrollment. Unchanged from the proposed regulations, the final regulations require those QHP issuers to disclose on the SBC whether non-excepted and excepted abortion services (those for which public funding is permitted) are covered or excluded, consistent with the guidance of the HHS Secretary.

The departments note that the proposed updates to the SBC template and instruction guides included guidance for QHP issuers on the wording and placement of this disclosure on the SBC. They also note the revisions will not be finalized until January 2016 and will not be applicable until SBCs are issued in connection with coverage that begins on or after Jan. 1, 2017. Until the new template and associated documents are finalized and applicable, QHP issuers through the individual marketplace may adopt any reasonable wording and placement of the disclosure on the SBC. They may also provide the disclosure in a cover letter or other separate notice provided with the SBC.