Properly Distributing ERISA Health and Welfare Plan Materials 1-2

Special distribution rules for SBCs

The rules for distributing SBCs electronically are somewhat more relaxed than the rules for the other materials described above.

• For enrolled participants, SBCs may be provided electronically by following the DOL safe harbor for ERISA disclosures, as described above.
• For eligible participants who are not enrolled in the plan, it is sufficient to post the SBCs online, provided that the participant receives an e-card or postcard explaining availability of the SBCs and the internet address. The federal rules offer sample language (shown below) to notify participants about online SBCs, although plan sponsors can modify the text.

If posted on the internet, the SBC must be:

•  in a readily accessible format;
•  placed in a prominent and readily accessible location;
•  in an electronic form that can be electronically retained and printed;
•  consistent with the appearance, content, and language requirements for SBCs; and
•  provided in paper form upon request, without charge. Notification regarding the availability of the electronic SBC in paper form must be provided to participants.

Below is a sample notification provided by the DOL.

Availability of Summary Health Information

As an employee, the health benefits available to you represent a significant component of your compensation package. They also provide important protection for you and your family in the case of illness or injury.

Your plan offers a series of health coverage options. Choosing a health coverage option is an important decision. To help you make an informed choice, your plan makes available a Summary of Benefits and Coverage (SBC), which summarizes important information about any health coverage option in a standard format, to help you compare across options.

The SBC is available on the web at www.website.com/SBC. A paper copy is also available, free of charge, by calling [phone number]

Conclusion

It’s important to understand the various distribution rules and the timing requirements to ensure compliant distribution of required notices and disclosures. The approach for providing the required materials and other employee communications requires careful, strategic planning and periodic review.

EPIC has developed a Compliance Checklist that summarizes details about the required notices and disclosures, including timeframes for distribution. To request a copy, please contact a member of your EPIC account team.

EPIC Employee Benefits Compliance Services For further information on this or any other topics, please contact your EPIC benefits consulting team. EPIC offers this material for general
information only. EPIC does not intend this material to be, nor may any person receiving this information construe or rely on this material as, tax or legal advice. The matters addressed in this document and any related discussions or correspondence should be reviewed and discussed with legal counsel prior to acting or relying on these materials.