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Summary of Benefits & Coverage

June 12, 2012

There has been some recent confusion as to the difference between a Summary of Benefits and Coverage (SBC) and a Summary Plan Description (SPD). Both are required by law and relate to a company’s group health insurance plan. Please read on to learn the differences, and who will be providing each of these documents to your SBAM customers.  
Summary of Benefits & Coverage
According to the regulations, an SBC must be provided to employers and individuals “when shopping for coverage, enrolling in coverage, at each new plan year, and within seven business days of requesting a copy from their health insurance issuer or group health plan.
Our interpretation is that the carrier must provide the SBC to participants and others who qualify for coverage.  This has to be done effective for plan/policy years and open enrollments beginning on or after September 23, 2012, health insurers and self-insured group health plans will be required to provide a standard summary of benefits and coverage. 
Blue Cross Blue Shield of Michigan and Blue Care Network provides the SBC and is planning on being ready to provide the SBC to all of their customer groups.  The SBC must be distributed with other open enrollment materials for open enrollments that begin on or after September 23, 2012, and by the first day of coverage if the content has changed. The information must be provided to all employees during open enrollments starting with the first open enrollment that begins on or after September 23, 2012.

Summary Plan Description
The U.S. Department of Labor (DOL) requires all employers with one or more employees to disclose certain items to benefit participants in a Summary Plan
Description (SPD). The regulations cover all types of employee benefit plans including health insurance plans. 

An SPD describes the rights and responsibilities of both 
the employer and employee under the group benefit plan by providing detailed information about the health plan itself. 

The Small Business Association of Michigan (SBAM) provides a free, customized Summary Plan Description (SPD) to our members enrolled in a sponsored Blue Cross Blue Shield of Michigan and Blue Care Network plan.

If you would like clarification or more information about an SBC or an SPD, please contact us today at (800) 362-5461. 

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