General Information

Q1. What is a Summary of Benefits and Coverage?

A1. A Summary of Benefits and Coverage (SBC) is four-page (double-sided) communication required by the federal government. It must contain specific information, in a specific order and with a minimum size type, about a group health benefit's coverage and limitations.

Q2. Who must provide an SBC?

A2. For fully insured plans, the insurer is responsible for providing the SBC to the plan administrator (usually this is the employer). The plan administrator and the insurer are both responsible for providing the SBC to participants, although only one of them actually has to do this.

For self-funded plans, the plan administrator is responsible for providing the SBC to participants. Assistance may be available from the plan administrator's TPA, advisor, etc., but the plan administrator is ultimately responsible. (The plan administrator is generally the employer, not the claims administrator.)

Q3. When is an SBC required?

A3. An SBC is required whenever application or open enrollment materials are provided to new hires or current employees. If no application or open enrollment materials are given, an SBC must be provided when the person can first enroll.

Q4. Are any plans exempt from this requirement?

A4. No. This requirement applies to all employers -- private, government, and not-for-profit, fully insured and self-funded, grandfathered and non-grandfathered. There is no minimum employer size to have this obligation.

However, there is a delayed effective date for closed blocks of insured business. An SBC does not need to be provided unless the Department of Labor issues additional instructions if:

• The insured product is no longer being actively marketed;
• The health insurer stopped actively marketing the product prior to September 23, 2012; and
• The health insurer has never provided an SBC with respect to the insured product.

In addition, expatriate plans do not have to provide SBCs until the 2016 plan year. (An expatriate plan is one designed to cover employees who are living overseas.)

Q5. What types of plans must provide SBCs?

A5. All group health plans must provide SBCs unless they are specifically exempted. Exempted plans include:

• Standalone dental and vision
• Health FSAs unless the plan is not an "excepted benefit" (see Question 16 for details)
• Retiree only plans
• Medicare supplement (Medicare Advantage)
• Hospital indemnity and specified diseases
• Long-term care
• Accident and disability

Q6. Are SBCs needed for wellness programs, EAPs and HRAs?

A6. In certain circumstances, yes. See Questions 12 - 14.

To download the full FAQ which includes information on Completing the SBC, Completing the Coverage Examples, Distributing the SBC, and more, please download the FAQ PDF below!