Health Reform WK-EDGE FAQs clarify updates to summary of benefits and coverage for 2021
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Tuesday, February 11, 2020

FAQs clarify updates to summary of benefits and coverage for 2021

By Rebecca Mayo, J.D.

A FAQ sheet was released to help group health plans and health insurance issuers prepare for changes to the 2021 summary of benefits and coverage tools.

In an effort to help people understand the Patient Protection and Affordable Care Act, and benefit from it, as intended, HHS, the Department of Labor and the Treasury have answered some Frequently Asked Questions (FAQs) from stakeholders. The FAQ discusses the November 7, 2019, updates to the summary of benefits and coverage (SBC) examples calculator, the Guide and Narratives for coverage examples, and instructions for completing the SBC Template, and the SBC Template and associated materials. Group health plans and health insurance issuers of individual and group market coverage will be required to use these updated versions beginning on the first day of the first open enrollment period of any plan years that begin on or after January 1, 2021.

SBC template. Starting January 1, 2019, the tax payment required for not having Minimum Essential Coverage or a coverage exemption was reduced to zero. Therefore the Minimum Essential Coverage disclosure statement in the SBC Template and Instructions as authorized for use on and after April 1, 2017 was updated. The Uniform Glossary was also updated to remove the definition of Individual Responsibility Requirement and update the definition of Minimum Essential Coverage. Additionally, the concept of minimum value is not relevant with respect to individual market coverage. To reflect this, the 2021 SBC Template adds "Not Applicable" as a response option for the Minimum Value disclosure and the instructions indicate that issuers of individual market coverage should answer "Not Applicable."

Other updates. The 2021 Calculator and 2021 Guide and Narratives replace 2013 Truven Health MarketScan data with 2016 data, update some of the treatment protocols for the SBC medical scenarios, and update the Calculator’s logic to better align its underlying assumptions with how most plans and issuers apply cost sharing rules. The Calculator makes several assumptions that may not be accurate for all plans or policy designs, therefore plans and issuers may create their own calculator using the Guide and Narratives provided by HHS or modify the logic of the Calculator to provide their own method of calculating estimated-out-of-pocket costs. The safe harbor for plans and issuers that use the Calculator for the SBC requirements will continue to be in effect until further guidance is issued.

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