The Internal Revenue Service, the Employee Benefits Security Administration, and the Centers for Medicare and Medicaid Services Aug. 17 released a proposed rule (Reg-140038-10) that would require insurers to make available to consumers a standardized summary of the benefits and coverage for each plan they offer.
The goal of the proposed rule is to increase transparency in the insurance market so that consumers can compare plans on an apples-to-apples basis and make an informed choice about which to purchase. Insurers and group health plans will be required to provide the information.
The standard summary, which can be no more than four double-sided pages, would have to include information about the policy a consumer is considering, such as its premium and deductible costs, covered benefits, and coverage limitations and exceptions. In addition, the summary would have to include coverage examples that show how much a consumer would pay in three common scenarios: having a baby, treating breast cancer, and managing diabetes.
Insurers also would have to provide consumers with a separate glossary that defines insurance terms such as co-payment and deductible.
Under the proposed rule, health insurance issuers and group health plans would be required to provide either online or in print the summary and the glossary to consumers before they purchase or enroll in a plan, including before a plan is reissued or renewed. Insurers also would have to notify beneficiaries of any significant changes to the terms of coverage at least 60 days before the change takes effect.
In addition, a potential consumer or a person enrolled in a plan could request a copy of the summary and must receive it within seven days.
The departments of Health and Human Services, Treasury, and Labor issued the proposed rule, which implements part of the Patient Protection and Affordable Care Act.
Providing Consumers More ‘Access to Information'
“Today, many consumers don't have easy access to information in plain English to help them understand the differences in the coverage and benefits provided by different health plans,” HHS Secretary Kathleen Sebelius said in a statement. “Thanks to the Affordable Care Act, that will change.”
The proposed rule is scheduled for publication in the Aug. 22 Federal Register, and comments are due 60 days later.
Consumer, Insurer Reactions
Consumer groups such as Consumers Union and Families USA lauded the release of the proposed rule, saying it would make navigating the insurance marketplace much easier.
Ron Pollack, executive director of Families USA, called the proposal a “triumph of common sense.”
The complete text of this article can be found in the BNA Daily Tax Report, August 18, 2011.