SBC Contract - Anthem Health Care Reform Portal

Health care reform at-a-glanceSummary of Benefits and Coverage contract addendumThe Affordable Care Act (health care reform law) requires health insurers to provide fully insured groups with aneasy-to-understand Summary of Benefits and Coverage (SBC). Employers must send this SBC electronically or in apaper format to their employees as part of their open enrollment process or due to a special enrollment event.We are sending a contract amendment to our fully insured groups that reflects the SBC rules . It is effective onSeptember 23, 2012. The following FAQs answer questions about SBCs and the contract amendment.Questions and answersQ. Why are you changing our contract?A. We are changing the contract to reflect the requirements related to SBCs under the health care reform law. Thecontract requires employers to distribute the SBC to participants and beneficiaries electronically or on paper.Q. Is the contract addendum for all types of employer groups and segments?A. No, it only applies to fully insured groups.Q. How are you helping employers send out SBCs to their employees?A. We will create the SBC so you can give it to your employees in either a paper or electronic format. Also, we willcontinue to provide you with detailed informat ion and timelines related to SBCs. Also, an employer’s guide onSBCs is coming soon.Q. What happens if I don’t send renewal information to you ahead of time?A. If you don’t send us your renewal information in time, we will provide an SBC with your current benefits.If you decide to change your benefits later, you must send a new SBC to your employees showing the newbenefits. However, the law may define the benefit change as a material modification. If the change is a materialmodification, you may not be able to apply the new benefits until you have provided your employees with atleast 60 days advanced written notice of the new benefit plan.Fully insured groups should work together with their sales representative to define a deadline that allowsenough time for us to provide final SBCs to the group and for the group to then distribute the SBC(s) accordingto one of the following deadlines:If the group’s benefits renew automatically (no application or paperwork required): Employees mustreceive a finalized SBC no later than 30 days prior to the renewal date.If the group has an open enrollment period during which employees can enroll in or change theirbenefit plan: Employees must receive finalized SBCs with the rest of their open enrollment material s, nolater than the first day of the open enrollment period.If the group and insurer have not renewed the contract at least 30 days before the start of the newplan year, then SBCs should be provided as soon as possible but not later than seven business days afterthe renewal policy is issued or written confirmation of intent to renew, whichever is earlier.

Q. Does the health care reform law have penalties for not sending an SBC on time?A. Yes, if an employer doesn’t send the SBC to eligible employees on time, fines may be assessed. There is a fineof up to $1,000 for each person affected by a carrier or employer that willfully (intentionally) fails to send anSBC.Also, health care reform includes a fine of $100 per day, per affected person until an employer complies (whichdoes not require willful conduct). So, for example, if a group with 500 employees is out of compliance for 30days, the fine could add up to $2 million.For 2013, FAQs released by the US Department of Labor indicates monetary penalties may not be applied ifcarriers and groups are making their best effort to be compliant.Q. Are you sending the contract addendum to all of the groups in an association or only the association’smain office?A. We are sending the contract addendum only to an association’s main office. For example, while a state barassociation is made up of many law firms, we would only send the contract addendum to the state barassociation and the amendment applies to all participant organizations in the association. If a groupparticipating under an association’s plan has a renewal prior to the association’s open enrollment period, theyshould contact their broker or sales representative for an SBC.This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should notbe relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.Anthem Blue Cross is the trade name of Blue Cross of California. Anthem Blue Cross and Anthem Blue Cross Life and Health Insurance Company are independent licensees of the Blue Cross Association.® ANTHEM is a registered trademark of Anthem Insurance Companies, Inc. The Blue Cross name and symbol are registered marks of the Blue Cros s Association.