On February 14, 2012, the U.S. Department of the Treasury, Department of Labor, and Department of Health and Human Services (collectively referred to as the "Departments") published the Summary of Benefits and Coverage ("SBC") Final Rule (the "Final Rule) implementing Section 2715 of the Public Health Service Act ("PHSA"), as added by the Patient Protection and Affordable Care Act ("PPACA"). This section of PPACA required the Departments to develop standards for use by group health plans and health insurance issuers offering group or individual health coverage in providing SBCs. Accordingly, the Final Rule details how the Departments envision an SBC that "accurately describes the benefits and coverage under the applicable plan or coverage." Additionally, the Final Rule sets forth a list of key definitions ("uniform glossary") meant to help explain insurance terms.

Taken together, these two forms, the SBC and the uniform glossary, are intended to ease the process for consumers to evaluate and purchase insurance coverage and to render the system more accessible to consumers by increasing their understanding of coverage options. Although increasing consumer understanding is a worthy goal, the SBC requirements pose a significant burden and new risk to group health plans and issuers that will have to collect the applicable information, assemble it into the specific format discussed below, and distribute it as delineated in detail in the Final Rule. Moreover, even though the Final Rule extends the time period within which group health plans and issuers have to come into compliance with these federal requirements, there is still work to be done in a short time. Additionally, it is premature to know whether consumers will take advantage of these forms as intended and, even if they do, how useful the forms may be when making decisions regarding their coverage options.

Please see full alert below for more information.