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Regulation and Compliance > Federal Regulation

Feds aim benefits scenario at young invincibles

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Federal agencies want to change the standard “nutrition label for health plans” in a way that could make it more appealing for young, healthy insurance buyers.

The agencies — the Internal Revenue Service (IRS), the Employee Benefits Security Administration (EBSA) and the U.S. Department of Health and Human Services (HHS) — have included the change in a package of draft summary of benefits and coverage (SBC) regulations.

If adopted, the regulations would update the way the agencies implement the SBC provisions in the Patient Protection and Affordable Care Act (PPACA). Issuers of individual coverage and the issuers and administrators of group coverage are supposed to offer SBCs to enrollees and prospects, to help consumers make “apples to apples” comparisons of health plans.

Originally, regulators were going to require SBC creators to offer consumers three scenarios illustrating how coverage might work in the real world. One would deal with managing diabetes, a second with having a baby, and a third with dealing with breast cancer.

See also: PPACA: Feds Unveil Final Benefits Summary Rule.

Regulators eventually eliminated the breast cancer scenario. SBCs now include only a diabetes scenario and a pregnancy scenario.

See also: 10 plans summarize diabetes benefits.

Regulators are now proposing that SBC issuers add a third scenario. Rather than focusing on breast cancer, the scenario would illustrate how a plan would handle a simple fracture, such as a foot fracture, that leads to an emergency room visit.

An SBC can be no longer than four double-sided pages long, and the print must be in a 12-point font or a bigger font.

If the proposed regulations take effect as written, insurers would still have to include all of the information required by PPACA, but the agencies said they have tried to eliminate some of the extra requirements they imposed, to help issuers get the PPACA-required information into four double-sided pages.

Regulators also are trying to help benefits vendors  determine who’s really responsible for meeting SBC requirements. Regulators have already provided safe harbor guidance that puts an employer’s benefits administrator in charge of SBCs. The agencies are thinking about codifying that system in the new regulation.

The draft regulations are set to appear in the Federal Register Dec. 30. Comments would be due 60 days after the official publication date.


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