With upcoming health care reform changes coming this fall, employers are facing a couple of major changes, and they should start preparing for these new provisions now.
In particular, the Summary of Benefits and Coverage requirement is expected to provide some preparation challenges to employers, says Katy Stowers, advisor and general counsel of FirstPerson, an employee benefits firm in Indianapolis. Under the new SBC requirement, employers must distribute the SBC document to all employees who are eligible to participate in an employer plan for those beginning Oct. 1 and beyond.
However, employers cannot simply look at the plan year rule because these summaries must be distributed on the first day of open enrollment.
“Because employers are often just making their benefits decisions right before the enrollment period, there’s a pretty quick turnaround time for preparation for these, so they’re ready to be distributed the first day,” Stowers says. “It’s really the timing that makes this most challenging.”
Fortunately for employers, the Department of Labor recently released a list of frequently asked questions and revealed that any employer that conducts online enrollment for health benefits is permitted to distribute the SBC electronically in conjunction.
“This lightens the burden in terms of getting these SBCs prepared and distributed, especially for employers with multiple locations or a lot of employees who telecommute, so that was some welcome news we had recently.”
Coming this fall, there will also be a new formal audit initiative of all entities that are covered by the Health Insurance Portability and Accountability Act, Stowers says. These audits are specifically designed to check for compliance on mobile technology platforms, such as email, laptops and smartphones. With these new changes, it’s especially important for employers to start preparing employees who deal with this type of information.
To do so, Stowers recommends that employers appoint a privacy and security officer who relays those procedures to other employees who are exposed to HIPAA-secured electronic information. While these new regulations do not need to be communicated to the entire employee population, those handling HIPAA-secured information should be well-trained on the new audit initiative.
“Communicating these compliance requirements needs to be a continual process and something employers should always be revisiting,” Stowers says. “I would say now is definitely a time to start preparing for employers that have not been diligent in this respect. They want to start now because substantial penalties do attach to noncompliance.”
As 2014 approaches, it is also important that employers start communicating the upcoming changes with employees now, Stowers says. With health care reform being such a hot political issue, there is a great deal of misinformation out there, and how much an employer communicates with its employees could determine the smoothness of the health care reform transition.