Starting March 23, 2012, plan administrators and insurers will be required to provide a uniform Summary of Benefits and Coverage (“SBC”). The SBC is a new, additional required disclosure, and does not replace the summary plan description (“SPD”) or summary of material modification (“SMM”).

On Aug. 22, 2011, the Departments of Labor, Treasury, and Health and Human Services issued proposed regulations setting out standards for the new 4-page benefit summary required under the Patient Protection and Affordable Care Act. The proposed rule sets out the content and format of the disclosure, who must provide and who will receive the summary, and when and how the summary will be provided. On the same day, the agencies issued a template of the SBC and a new uniform glossary of terms commonly used in health insurance coverage.

The SBC’s purpose is to help consumers better understand their options and thereby make better-informed decisions about their health care coverage. Under the proposed regulations, insurers and group health plans would provide clear and consistent information to consumers in a short, easy-to-read format, using uniform terms. Because every group health plan would be outlined in an SBC, the use of SBCs is also expected to result in greater transparency in pricing and benefits information and help consumers, including plan sponsors, more accurately compare coverages.