FAQs About Affordable Care Act Implementation Part 41 (Feb. 3, 2020)
The DOL, HHS, and IRS have jointly issued two FAQs addressing the updated template for the summary of benefits and coverage (SBC) and related materials to be used beginning in 2021 (see our Checkpoint article). The first FAQ reiterates that the 2021 versions of the SBC template, instructions, coverage example guide and narratives, and optional coverage examples calculator must be used beginning with the first day of the first open enrollment period for any plan year beginning on or after January 1, 2021, with respect to coverage for plan years beginning on or after that date.
The second FAQ clarifies that the coverage examples calculator is not required to be used. It explains that the calculator was developed as a tool to assist group health plans and health insurers in determining estimated amounts necessary to complete the coverage examples on the SBC. Plans and insurers may instead develop their own calculator (using the guide and narratives) or may modify the calculator to more accurately reflect a plan’s design. The FAQ explains that the calculator was initially introduced during the first year of the SBC requirement’s applicability as a transitional safe harbor that was later extended (see our Checkpoint article). Absent further guidance, the FAQ provides that the calculator may continue to be used even in cases where it would be possible for a plan or insurer to develop a more accurate method for completing the coverage examples.
EBIA Comment: Separately, the agencies announced that the 2021 versions of the SBC materials have been reposted to correct “minor errors” identified in several documents, including the template. (Although the HHS website lists a “Summary of Changes” describing these updates, the summary does not appear to be available at this time.) When preparing SBCs for plan years beginning in 2021, plans should be sure to use the latest version of the materials. For more information, see EBIA’s Health Care Reform manual at Section XVI (“Summary of Benefits and Coverage (SBC)”) and EBIA’s ERISA Compliance manual at Section XXIV.O (“Summary of Benefits and Coverage (SBC) Under Health Care Reform”).
Contributing Editors: EBIA Staff.