Employer-sponsored health plans and insurers are required to make two changes to the summary of benefits and coverage, which must be distributed to all health plan participants under health reform.
They must add statements of whether their coverage: (1) provides minimum essential coverage; and (2) meets the minimum value requirements. The specific language to be included is:
Does this Coverage Provide Minimum Essential Coverage?
The Affordable Care Act requires most people to have health care coverage that qualifies as “minimum essential coverage.” This plan or policy [does/does not] provide minimum essential coverage.
Does this Coverage Meet the Minimum Value Standard?
In order for certain types of health coverage (for example, individually purchased insurance or job-based coverage) to qualify as minimum essential coverage, the plan must pay, on average, at least 60 percent of allowed charges for covered services. This is called the “minimum value standard.” This health coverage [does/does not] meet the minimum value standard for the benefits it provides.
If plans fail to offer minimum essential coverage, they become open to fines under health reform’s pay-or-play provisions. A similar outcome is possible if they fail to meet reform’s MV standard. MEC is defined in section 5000A(f) of the Internal Revenue Code. The MV standard ensures that a plan’s payout of benefits is not less than 60 percent of their cost. The federal government has yet to issue rules defining how exactly plans are to meet reform’s MV standard.
Note: If a sponsor can show it would be an undue hardship to include the changes (perhaps because it has already printed 2014 forms), it may be granted an enforcement safe harbor.
The first SBC templates lacked statements on plans meeting MEC and MV requirements.