Smart Benefits: New SBC for 2021 Released

Monday, January 20, 2020

Rob Calise, GoLocalWorcester Business/Health Expert

Rob Calise

The Departments of Labor and Health and Human Services recently released a new Summary of Benefits and Coverage (SBC) template – as well as updated instructions – to replace the version from 2017. The latest edition includes minor changes, most notably to reflect the elimination of the individual mandate.

This new template should be used by health insurers and self-insured group plans for open enrollment for plan years beginning January 1, 2021, or later. Here’s what you need to know about the SBC to stay compliant.

What is an SBC?

All group health plans and health insurance issuers offering group health insurance coverage are generally required to provide applicants, enrollees, and policyholders or certificate holders with an accurate SBC.

When is it due?

For renewals, the 2021 edition of the SBC template must be provided beginning on the first day of the first open enrollment period for any plan years (or, in the individual market, policy years) that begin on or after January 1, 2021, with respect to coverage for plan or policy years beginning on or after that date. It must also be furnished upon request, within seven days, and no later than seven business days following receipt of an application for individual or group health insurance coverage.

How should it be provided?

An SBC may be provided in either paper or electronic format – emailed or posted – as long as disclosure requirements are met.

Is it required in a language other than English?

For all group health plans and health insurance issuers, the SBC must include language access taglines that indicate the availability of language services in a particular non-English language if 10 percent or more of the population residing in the county is literate only in that same non-English language.

What’s the penalty for noncompliance?

For penalties assessed after January 15, 2020, the maximum penalty for failing to provide an SBC is $1,176 per enrollee for each failure to comply.

Rob Calise is the Managing Director, Employee Benefits of The Hilb Group of New England, where he helps clients control the costs of employee benefits by focusing on consumer-driven strategies and on how to best utilize the tax savings tools the government provides. Rob serves as Chairman of the Board of United Benefit Advisors, and is a board member of the Blue Cross & Blue Shield of RI Broker Advisory Board, United HealthCare of New England Broker Advisory Board and Rhode Island Business Healthcare Advisors Council. He is also a member of the National Association of Health Underwriters (NAHU), American Health Insurance Association (AHIA) and the Employers Council on Flexible Compensation (ECFC), as well as various human resource associations. Rob is a graduate of Bryant University with a BS in Finance