Summary of benefits provision goes into effect

Confused about health insurance plans? Now, consumers can just check a label.

As of Sept. 23, insurance companies and employers are required to provide consumers in the private health insurance market a Summary of Benefits and Coverage—a brief summary of what a health insurance policy or employer plan covers.

The new requirement is part of the Patient Protection and Affordable Care Act, and has been the runaway favorite provision of the law, according to a Kaiser Family Foundation poll. With a 60 percent approval rating, it’s the only provision in the entire law to be rated favorably by more than half of respondents.

Additionally, consumers will have access to a uniform glossary that defines insurance and medical terms in standard, consumer-friendly terms.

The Department of Health and Human Services says these tools will assist employers in finding the best coverage for their business and employees.

The SBC includes a new comparison tool—called coverage examples, which is modeled on the Nutrition Facts label required for packaged food—that helps consumers compare coverage options by showing a standardized sample of what each health plan will cover for two common medical situations—having a baby and managing type 2 diabetes.

It will include information about the covered health benefits, out-of-pocket costs and the network of providers. The glossary defines terms commonly used in the health insurance market, such as “deductible” and “co-pay,” using clear language.

The information can be requested at any time, but it will also be made available when shopping for, enrolling in or renewing coverage. It will also be provided whenever information in the SBC changes significantly.

The SBC will be available beginning today for consumers in the individual health insurance market. For enrollees in group health plans enrolling during an open enrollment period, it will be available during the next open enrollment period that starts on or after Sept. 23. For enrollees who enroll outside of an open enrollment period, it will be available at the start of the next plan year that begins on or after Sept. 23.


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