Affordable Care Act (ACA)

The following are certain disclosures, notices and reporting currently required for group health plans under the ACA. This is not an exhaustive list of ACA requirements, nor does it include past requirements that are no longer applicable, or future requirements that are not yet effective.

Summary of Benefits and Coverage (SBC)

Group health plans (other than excepted benefits and retiree plans) are required to furnish an SBC for each benefit option. The SBC is a uniform explanation of benefits that is required in addition to other ERISA disclosure requirements (i.e., SPDs). Regulations specify language and format that must be used. The DOL issued final regulations on a new SBC template, and instructions in April 2016. The rules apply to all SBCs created on or after April 1, 2017. More recently, the DOL released a new SBC template that is required to be used with respect to all plan years beginning on or after January 1, 2021. Current and revised SBC templates can be found on the DOL website.

SBCs must be distributed:

1. At initial enrollment;
2. Annually at re-enrollment;
3. Within 90 days after enrollment resulting from a special enrollment right; and
4. Within seven (7) business days of an employee/ beneficiary request.

Notice of mid-year material modifications to an SBC must be provided at least 60 days prior to the effective date of the change.

Model Notice to Employees of Coverage Options (“Public Exchange” Notice)

The notice must broadly describe the existence of the Health Insurance Marketplace and the ramifications if an employee purchases individual coverage on the Marketplace instead of enrolling in the employer’s coverage. The notice must be provided to new employees within 14 days of the employee’s start date. This includes employees who are not eligible for the employer’s health benefits.

Grandfathered Health Plan Disclosure – Grandfathered Health Plans Only

Grandfathered health plans must include language (in any plan materials describing the plan’s benefits), indicating that the plan believes it is a grandfathered health plan under the health care reform law and it must provide contact information for questions and complaints.

Internal Claims and Appeals and External Review Requirements – Non-Grandfathered Health Plans Only

Governmental group health plans are not subject to ERISA. As a result, the ERISA claims and appeals requirements historically were not applicable to governmental plans. The ACA incorporated the ERISA claims and appeals requirements in the Public Health Services Act, which does apply to governmental group health plans. As a result, governmental group health plans (other than excepted benefits and retiree plans) must implement an internal claims and appeals process that satisfies the ERISA claims and appeals requirements. Group health plans must also implement new procedural requirements for appeals as required by the ACA and make external review available. Model notices have been issued for claim denials/external review decisions. Language generally should be included in plan documents. Employers should confirm that their health plan’s appeals procedures comply with these requirements.

Patient Protection Disclosure – Non-Grandfathered Health Plans Only

Plans that require the designation of a primary care physician (PCP) must provide a notice of patient protections under health care reform whenever the plan or issuer provides a participant with a summary plan description or other similar description of benefits under the plan or health insurance coverage. NOTE: Plans that do not require/allow PCP designations are not required to provide this notice. In general, most PPOs do not require PCP designation; however, we are seeing some carriers request or assign PCPs on PPOs for provider payment under accountable care contracts. We recommend confirming if this notice applies to your plans.

Regulatory and Legislative Strategy Group