Section 2001.10 Summary of Benefits and Coverage and Uniform Glossary

TITLE 50: INSURANCE

CHAPTER I: DEPARTMENT OF INSURANCE

SUBCHAPTER z: ACCIDENT AND HEALTH INSURANCE

PART 2001 CONSTRUCTION AND FILING OF ACCIDENT AND HEALTH INSURANCE POLICY FORMS

SECTION 2001.10 SUMMARY OF BENEFITS AND COVERAGE AND UNIFORM GLOSSARY

Section 2001.10

Summary of Benefits

and Coverage and Uniform Glossary

a)         Summary

of Benefits and Coverage in General

A group health plan

(and its administrator as defined in section 3(16)(A) of ERISA), and a health

insurance issuer offering group or individual health insurance coverage, is

required to file for the Director's approval prior to use a written summary of

benefits and coverage (SBC) for each benefit package and provide the SBC

without charge to entities and individuals described in this subsection (a) in

accordance with this Section.

1)         SBC

Provided by a Group Health Insurance Issuer to a Group Health Plan

A)        Upon

Application

A health insurance

issuer offering group health insurance coverage must provide the SBC to a group

health plan (or its sponsor) upon application for health coverage, as soon as

practicable following receipt of the application, but in no event later than

seven business days following receipt of the application.

B)        By

First Day of Coverage (If There Are Changes)

If there is any

change in the information required to be in the SBC that was provided upon

application and before the first day of coverage, the issuer must update and

provide a current SBC to the plan (or its sponsor) no later than the first day

of coverage.

C)        Upon

Renewal

If the issuer renews

or reissues the policy, certificate or contract of insurance (for example, for

a succeeding policy year), the issuer must provide a new SBC as follows:

i)          If

written application is required (in either paper or electronic form) for

renewal or reissuance, the SBC must be provided no later than the date the

written application materials are distributed

Upon

Renewal

If the issuer renews

or reissues the policy, certificate or contract of insurance (for example, for

a succeeding policy year), the issuer must provide a new SBC as follows:

i)          If

written application is required (in either paper or electronic form) for

renewal or reissuance, the SBC must be provided no later than the date the

written application materials are distributed.

ii)         If

renewal or reissuance is automatic, the SBC must be provided no later than 30

days prior to the first day of the new plan or policy year; however, with

respect to an insured plan, if the policy, certificate or contract of insurance

has not been issued or renewed before such 30-day period, the SBC must be

provided as soon as practicable but in no event later than seven business days

after issuance of the new policy, certificate or contract of insurance, or the

receipt of written confirmation of intent to renew, whichever is earlier.

D)

Upon Request

If a group health

plan (or its sponsor) requests an SBC or summary information about a health

insurance product from a health insurance issuer offering group health

insurance coverage, an SBC must be provided as soon as practicable, but in no

event later than seven business days following receipt of the request.

2)

SBC Provided by a Group Health Insurance Issuer and a Group Health

Plan to Participants and Beneficiaries

A)        In

General

A group health plan

(including its administrator, as defined under section 3(16) of ERISA), and a

health insurance issuer offering group health insurance coverage, must provide

an SBC to a participant or beneficiary (as defined under sections 3(7) and 3(8)

of ERISA), and consistent with subsection (a)(3) of this Section, with respect

to each benefit package offered by the plan or issuer for which the participant

or beneficiary is eligible.

B)        Upon

Application

The SBC must be

provided as part of any written application materials that are distributed by

the plan or issuer for enrollment

beneficiary (as defined under sections 3(7) and 3(8)

of ERISA), and consistent with subsection (a)(3) of this Section, with respect

to each benefit package offered by the plan or issuer for which the participant

or beneficiary is eligible.

B)        Upon

Application

The SBC must be

provided as part of any written application materials that are distributed by

the plan or issuer for enrollment. If the plan or issuer does not distribute

written application materials for enrollment, the SBC must be distributed no

later than the first date on which the participant is eligible to enroll in

coverage for the participant or any beneficiaries.

C)        By

First Day of Coverage (If There Are Changes)

If there is any

change to the information required to be in the SBC that was provided upon

application and before the first day of coverage, the plan or issuer must

update and provide a current SBC to a participant or beneficiary no later than

the first day of coverage.

D)        Special

Enrollees

The plan or issuer

must provide the SBC to special enrollees (as described in 45 CFR

146.117

) no later than the date by which a summary plan description is

required to be provided under the timeframe set forth in ERISA section

104(b)(1)(A), which is 90 days from enrollment.

E)        Upon

Renewal

If the plan or

issuer requires participants or beneficiaries to renew in order to maintain

coverage (for example, for a succeeding plan year), the plan or issuer must

provide a new SBC when the coverage is renewed, as follows:

i)          If

written application is required for renewal (in either paper or electronic

form), the SBC must be provided no later than the date on which the written

application materials are distributed

icipants or beneficiaries to renew in order to maintain

coverage (for example, for a succeeding plan year), the plan or issuer must

provide a new SBC when the coverage is renewed, as follows:

i)          If

written application is required for renewal (in either paper or electronic

form), the SBC must be provided no later than the date on which the written

application materials are distributed.

ii)         If

renewal is automatic, the SBC must be provided no later than 30 days prior to

the first day of the new plan or policy year; however, with respect to an

insured plan, if the policy, certificate, or contract of insurance has not been

issued or renewed before such 30-day period, the SBC must be provided as soon

as practicable but in no event later than seven business days after issuance of

the new policy, certificate or contract of insurance, or the receipt of written

confirmation of intent to renew, whichever is earlier.

F)         Upon Request

A plan or issuer

must provide the SBC to participants or beneficiaries upon request for an SBC

or summary information about the health coverage, as soon as practicable, but

in no event later than seven business days following receipt of the request.

3)

Special Rules to Prevent Unnecessary Duplication with Respect

to Group Health Coverage

A)

An entity required to provide an SBC under subsection (a) with

respect to an individual satisfies that requirement if another party provides

the SBC, but only to the extent that the SBC is timely and complete in

accordance with this Section. Therefore, for example, in the case of a group

health plan funded through an insurance policy, the plan satisfies the

requirement to provide an SBC with respect to an individual if the issuer

provides a timely and complete SBC to the individual.

B)

If a single SBC is provided to a participant and any

beneficiaries at the participant's last known address, then the requirement to

provide the SBC to the participant and any beneficiaries is generally

satisfied

through an insurance policy, the plan satisfies the

requirement to provide an SBC with respect to an individual if the issuer

provides a timely and complete SBC to the individual.

B)

If a single SBC is provided to a participant and any

beneficiaries at the participant's last known address, then the requirement to

provide the SBC to the participant and any beneficiaries is generally

satisfied. However, if a beneficiary's last known address is different than the

participant's last known address, a separate SBC is required to be provided to

the beneficiary at the beneficiary's last known address.

C)

With respect to a group health plan that offers multiple

benefit packages, the plan or issuer is required to provide a new SBC

automatically upon renewal only with respect to the benefit package in which a

participant or beneficiary is enrolled; SBCs are not required to be provided

automatically upon renewal with respect to benefit packages in which the

participant or beneficiary is not enrolled. However, if a participant or

beneficiary requests an SBC with respect to another benefit package (or more

than one other benefit package) for which the participant or beneficiary is

eligible, the SBC (or SBCs, in the case of a request for SBCs relating to more

than one benefit package) must be provided upon request as soon as practicable,

but in no event later than seven business days following receipt of the request.

4)

SBC Provided by a Health Insurance Issuer Offering Individual Health

Insurance Coverage

A)        Upon

Application

A health insurance

issuer offering individual health insurance coverage must provide an SBC to an

individual covered under the policy (including every dependent) upon receiving

an application for any health insurance policy, as soon as practicable following

receipt of the application, but in no event later than seven business days

following receipt of the application

Upon

Application

A health insurance

issuer offering individual health insurance coverage must provide an SBC to an

individual covered under the policy (including every dependent) upon receiving

an application for any health insurance policy, as soon as practicable following

receipt of the application, but in no event later than seven business days

following receipt of the application.

B)

By First Day of Coverage (If There Are Changes)

If there is any

change in the information required to be in the SBC that was provided upon

application and before the first day of coverage, the issuer must update and

provide a current SBC to the individual no later than the first day of

coverage.

C)

Upon Renewal

The issuer must

provide the SBC to policyholders annually at renewal. The SBC must reflect any

modified policy terms that would be effective on the first day of the new

policy year. The SBC must be provided as follows:

i)          If

written application is required (in either paper or electronic form) for

renewal or reissuance, the SBC must be provided no later than the date on which

the written application materials are distributed.

ii)         If

renewal or reissuance is automatic, the SBC must be provided no later than 30

days prior to the first day of the new policy year; however, if the policy,

certificate or contract of insurance has not been issued or renewed before such

30-day period, the SBC must be provided as soon as practicable but in no event

later than seven business days after issuance of the new policy, certificate or

contract of insurance, or the receipt of written confirmation of intent to

renew, whichever is earlier.

D)

Upon Request

A health insurance

issuer offering individual health insurance coverage must provide an SBC to any

individual or dependent anytime an individual requests an SBC or summary

information about a health insurance product as soon as practicable, but in no

event later than seven business days following receipt of the request

ten confirmation of intent to

renew, whichever is earlier.

D)

Upon Request

A health insurance

issuer offering individual health insurance coverage must provide an SBC to any

individual or dependent anytime an individual requests an SBC or summary

information about a health insurance product as soon as practicable, but in no

event later than seven business days following receipt of the request. For

purposes of this subsection (a)(4)(D), a request for an SBC or summary

information about a health insurance product includes a request made both

before and after an individual submits an application for coverage.

5)

Special Rule to Prevent Unnecessary Duplication with Respect

to Individual Health Insurance Coverage

If a single SBC is

provided to an individual and any dependents at the individual's last known

address, then the requirement to provide the SBC to the individual and any

dependents is generally satisfied. However, if a dependent's last known address

is different than the individual's last known address, a separate SBC is

required to be provided to the dependent at the dependent's last known address.

b)

Summary of Benefits and Coverage − Content

1)         In

General

Subject to subsection

(b)(3), the SBC must include the following:

A)

Uniform definitions of standard insurance terms and medical

terms so that consumers may compare health coverage and understand the terms of

(or exceptions to) their coverage;

B)

A description of the coverage, including cost sharing, for each

category of benefits;

C)

The exceptions, reductions and limitations of the coverage;

D)

The cost-sharing provisions of the coverage, including

deductible, coinsurance and copayment obligations;

E)

The renewability and continuation of coverage provisions;

F)

Coverage examples, in accordance with subsection (b)(2);

G)

With respect to coverage beginning on or after January 1, 2014,

a statement about whether the plan or coverage provides minimum essential

coverage as defined under section 5000A(f) of the Internal Revenue Cod

ge, including

deductible, coinsurance and copayment obligations;

E)

The renewability and continuation of coverage provisions;

F)

Coverage examples, in accordance with subsection (b)(2);

G)

With respect to coverage beginning on or after January 1, 2014,

a statement about whether the plan or coverage provides minimum essential

coverage as defined under section 5000A(f) of the Internal Revenue Code (26 USC

5000A(f)) and whether the plan's or coverage's share of the total allowed costs

of benefits provided under the plan or coverage meets applicable requirements;

H)

A statement that the SBC is only a summary and that the plan

document or the policy, certificate or contract of insurance should be

consulted to determine the governing contractual provisions of the coverage;

I)

Contact information for questions and obtaining a copy of the

plan document or the insurance policy, certificate or contract of insurance

(such as a telephone number for customer service and an Internet address for

obtaining a copy of the plan document or the insurance policy, certificate or

contract of insurance);

J)

For plans and issuers that maintain one or more networks of

providers, an Internet address (or similar contact information) for obtaining a

list of network providers;

K)

For plans and issuers that use a formulary in providing

prescription drug coverage, an Internet address (or similar contact

information) for obtaining information on prescription drug coverage; and

L)

An Internet address for obtaining the uniform glossary, as

described in subsection (c), as well as a contact phone number to obtain a paper

copy of the uniform glossary, and a disclosure that paper copies are available.

2)

Coverage Examples

The SBC must include

coverage examples that illustrate benefits provided under the plan or coverage

for common benefits scenarios (including pregnancy and serious or chronic

medical conditions) in accordance with this subsection (b)(2)

on (c), as well as a contact phone number to obtain a paper

copy of the uniform glossary, and a disclosure that paper copies are available.

2)

Coverage Examples

The SBC must include

coverage examples that illustrate benefits provided under the plan or coverage

for common benefits scenarios (including pregnancy and serious or chronic

medical conditions) in accordance with this subsection (b)(2).

A)        Number of Examples

The Secretary may

identify up to six coverage examples that may be required in an SBC.

B)        Benefits Scenarios

For purposes of this

subsection (b)(2), a benefits scenario is a hypothetical situation, consisting

of a sample treatment plan for a specified medical condition during a specific

period of time, based on recognized clinical practice guidelines as defined by

the National Guideline Clearinghouse, Agency for Healthcare Research and

Quality.

C)

Illustration of Benefit Provided

For purposes of this

subsection (b)(2), to illustrate benefits provided under the plan or coverage

for a particular benefits scenario, a plan or issuer simulates claims

processing to generate an estimate of what an individual might expect to pay

under the plan, policy or benefit package. The illustration of benefits

provided will take into account any cost sharing, excluded benefits, and other

limitations on coverage.

3)

Coverage Provided Outside the United States

In lieu of

summarizing coverage for items and services provided outside the United States,

a plan or issuer may provide an Internet address (or similar contact

information) for obtaining information about benefits and coverage provided

outside the United States. In any case, the plan or issuer must provide an SBC

in accordance with this Section that accurately summarizes benefits and

coverage available under the plan or coverage within the United States

d outside the United States,

a plan or issuer may provide an Internet address (or similar contact

information) for obtaining information about benefits and coverage provided

outside the United States. In any case, the plan or issuer must provide an SBC

in accordance with this Section that accurately summarizes benefits and

coverage available under the plan or coverage within the United States.  (45

CFR 147.200)

c)         Summary of

Benefits and Coverage

−

Appearance

The SBC must be

presented in a uniform format, use terminology understandable by the average

plan enrollee (or, in the case of individual market coverage, the average

individual covered under a health insurance policy), not exceed four

double-sided pages in length, and not include print smaller than 12-point font.

A health insurance issuer offering individual health insurance coverage must

provide the SBC as a stand-alone document.  (45 CFR 147.200)

d)

Summary of Benefits and Coverage

–

Form

1)

An SBC provided by an issuer offering group health insurance

coverage to a plan (or its sponsor) may be provided in paper form.

Alternatively, the SBC may be provided electronically (such as by email or an

Internet posting) if the following three conditions are satisfied:

A)        The

format is readily accessible by the plan (or its sponsor);

B)        The

SBC is provided in paper form free of charge upon request; and

C)

If the electronic form is an Internet posting, the issuer

timely advises the plan (or its sponsor) in paper form or email that the

documents are available on the Internet and provides the Internet address.

2)

An SBC provided by a group health plan or health insurance issuer to a

participant or beneficiary may be provided in paper form

s provided in paper form free of charge upon request; and

C)

If the electronic form is an Internet posting, the issuer

timely advises the plan (or its sponsor) in paper form or email that the

documents are available on the Internet and provides the Internet address.

2)

An SBC provided by a group health plan or health insurance issuer to a

participant or beneficiary may be provided in paper form. Alternatively, for

non-federal governmental plans, the SBC may be provided electronically if the

plan conforms to either the substance of the ERISA provisions at 29 CFR

2590.715-2715(a)(4)(ii)

, or the

provisions governing electronic disclosure for individual health insurance

issuers set forth in subsection (d)(3).

3)

An issuer offering individual health insurance coverage must

provide an SBC in a manner that can reasonably be expected to provide actual

notice in paper or electronic form.

A)

An issuer satisfies the requirements of subsection (d)(3) if

the issuer:

i)          Hand-delivers

a printed copy of the SBC to the individual or dependent;

ii)         Mails

a printed copy of the SBC to the mailing address provided to the issuer by the

individual or dependent;

iii)        Provides

the SBC by email after obtaining the individual's or dependent's agreement to

receive the SBC or other electronic disclosures by email;

iv)        Posts

the SBC on the Internet and advises the individual or dependent in paper or

electronic form, in a manner compliant with subsections (d)(3)(A)(i) through (iii),

that the SBC is available on the Internet and includes the applicable Internet

address; or

v)         Provides

the SBC by any other method that can reasonably be expected to provide actual

notice

disclosures by email;

iv)        Posts

the SBC on the Internet and advises the individual or dependent in paper or

electronic form, in a manner compliant with subsections (d)(3)(A)(i) through (iii),

that the SBC is available on the Internet and includes the applicable Internet

address; or

v)         Provides

the SBC by any other method that can reasonably be expected to provide actual

notice.

B)

An SBC may not be provided electronically unless:

i)          The

format is readily accessible;

ii)         The

SBC is placed in a location that is prominent and readily accessible;

iii)        The

SBC is provided in an electronic form that can be electronically retained and

printed;

iv

)        The SBC is consistent with the appearance, content and

language requirements of this Section;

v)         The

issuer notifies the individual or dependent that the SBC is available in paper

form without charge upon request and provides it upon request.

C)

Deemed Compliance

A health insurance

issuer offering individual health insurance coverage that provides the content

required under subsection (b) to the federal health reform Web portal described

in 45 CFR

159.120

will be deemed to satisfy the requirements of subsection (a)(4)(D)

with respect to a request for summary information about a health insurance

product made prior to an application for coverage. However, nothing in this subsection

(d)(3)(D) should be construed as otherwise limiting such issuer's obligations

under this Section.  (45 CFR 147.200)

e)         Summary

of Benefits and Coverage

–

Language

A group health plan

or health insurance issuer must provide the SBC in a culturally and

linguistically appropriate manner. For purposes of this subsection, a plan or

issuer is considered to provide the SBC in a culturally and linguistically

appropriate manner if the thresholds and standards of 45 CFR

147.136(e)

are met as applied to the SBC

Summary

of Benefits and Coverage

–

Language

A group health plan

or health insurance issuer must provide the SBC in a culturally and

linguistically appropriate manner. For purposes of this subsection, a plan or

issuer is considered to provide the SBC in a culturally and linguistically

appropriate manner if the thresholds and standards of 45 CFR

147.136(e)

are met as applied to the SBC. (45 CFR 147.200)

f)         Notice of Modification

If a group health

plan, or health insurance issuer offering group or individual health insurance

coverage, makes any material modification (as defined under section 102 of

ERISA) in any of the terms of the plan or coverage that would affect the

content of the SBC, that is not reflected in the most recently provided SBC,

and that occurs other than in connection with a renewal or reissuance of

coverage, the plan or issuer must provide notice of the modification to

enrollees (or, in the case of individual market coverage, an individual covered

under a health insurance policy) not later than 60 days prior to the date on

which the modification will become effective. The notice of modification must

be provided in a form that is consistent with subsection (d). (45 CFR 147.200)

g)

Uniform Glossary

1)

In General

A group health plan,

and a health insurance issuer offering group health insurance coverage, must

make available to participants and beneficiaries, and a health insurance issuer

offering individual health insurance coverage must make available to

applicants, policyholders and covered dependents, the uniform glossary

described in subsection (g)(2) in accordance with the appearance and form and

manner requirements of subsections (g)(3) and (g)(4)

fering group health insurance coverage, must

make available to participants and beneficiaries, and a health insurance issuer

offering individual health insurance coverage must make available to

applicants, policyholders and covered dependents, the uniform glossary

described in subsection (g)(2) in accordance with the appearance and form and

manner requirements of subsections (g)(3) and (g)(4).

2)

Health-Coverage-Related Terms and Medical

Terms

The uniform glossary

must provide uniform definitions of the following health-coverage-related terms

and medical terms:

A)

Allowed amount, appeal, balance billing, co-insurance,

complications of pregnancy, co-payment, deductible, durable medical equipment,

emergency medical condition, emergency medical transportation, emergency room

care, emergency services, excluded services, grievance, habilitation services,

health insurance, home health care, hospice services, hospitalization, hospital

outpatient care, in-network co-insurance, in-network co-payment, medically

necessary, network, non-preferred provider, out-of-network co-insurance,

out-of-network co-payment, out-of-pocket limit, physician services, plan,

preauthorization, preferred provider, premium, prescription drug coverage,

prescription drugs, primary care physician, primary care provider, provider,

reconstructive surgery, rehabilitation services, skilled nursing care,

specialist, usual customary and reasonable (UCR), and urgent care; and

B)

Such other terms as the Secretary determines are important to

define so that individuals and employers may compare and understand the terms

of coverage and medical benefits (including any exceptions to those benefits).

3)         Appearance

A group health plan,

and a health insurance issuer, must ensure the uniform glossary is presented in

a uniform format and uses terminology understandable by the average plan

enrollee (or, in the case of individual market coverage, an average individual

covered under a health insurance policy)

of coverage and medical benefits (including any exceptions to those benefits).

3)         Appearance

A group health plan,

and a health insurance issuer, must ensure the uniform glossary is presented in

a uniform format and uses terminology understandable by the average plan

enrollee (or, in the case of individual market coverage, an average individual

covered under a health insurance policy).

4)

Form and Manner

A plan or issuer

must make the uniform glossary described in subsection (g) available upon

request, in either paper or electronic form (as requested), within seven

business days after receipt of the request.  (45 CFR 147.200)

h)

Preemption

For purposes of this

Section, the provisions of PHS Act section 2724 continue to apply with respect

to preemption of Illinois law. In addition, Illinois laws that require a health

insurance issuer to provide an SBC that supplies less information than required

under subsections (a), (b), (c), (d) and (e) are preempted by federal law.  (45

CFR 147.200)

i)

Failure to Provide

A health insurance

issuer or a non-federal governmental health plan that willfully fails to

provide information required under this Section is subject to a fine of not

more than $1,000 for each such failure. A failure with respect to each covered

individual constitutes a separate offense for purposes of this subsection (i).

The Department and HHS will enforce these provisions in a manner consistent

with 45 CFR

150.101

through 150.465.  (45 CFR 147.200)

j)

Applicability Date

1)

This Section is applicable to group health plans and group

health insurance issuers in accordance with this subsection (j)

A failure with respect to each covered

individual constitutes a separate offense for purposes of this subsection (i).

The Department and HHS will enforce these provisions in a manner consistent

with 45 CFR

150.101

through 150.465.  (45 CFR 147.200)

j)

Applicability Date

1)

This Section is applicable to group health plans and group

health insurance issuers in accordance with this subsection (j). (See 45 CFR

147.140(d)

, providing that this Section applies to grandfathered health plans.)

A)

For disclosures with respect to participants and beneficiaries

who enroll or re-enroll through an open enrollment period (including

re-enrollees and late enrollees), this Section applies beginning on the first

day of the first open enrollment period that begins on or after September 23,

2012; and

B)

For disclosures with respect to participants and beneficiaries

who enroll in coverage other than through an open enrollment period (including

individuals who are newly eligible for coverage and special enrollees), this Section

applies beginning on the first day of the first plan year that begins on or

after September 23, 2012.

2)

For disclosures with respect to plans, and to individuals and

dependents in the individual market, this Section is applicable to health

insurance issuers beginning September 23, 2012.

(45

CFR 147.200)