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The Employee Retirement Income Security Act (ERISA) governs
approximately 2.5 million health benefit plans sponsored by private sector
employers nationwide. These plans provide a wide range of medical,
surgical, hospital and other health care benefits to some 134 million
Americans.
Under ERISA, workers and their families are entitled to receive a
summary plan description (SPD). The SPD is the primary document that gives
information about the plan, what benefits are available under the plan,
the rights of participant and beneficiaries under the plan, and how the
plan works.
Among other information, the SPD of health plans must describe:
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Cost-sharing provisions, including premiums,
deductibles, coinsurance and copayment amounts for which the
participant or beneficiary will be responsible
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Annual or lifetime caps or other limits on benefits
under the plan
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The extent to which preventive services are covered
under the plan
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Whether, and under what circumstances, existing and
new drugs are covered under the plan
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Whether, and under what circumstances, coverage is
provided for medical tests, devices and procedures
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Provisions governing the use of network providers,
the composition of provider networks and whether, and under what
circumstances, coverage is provided for out-of-network services
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Conditions or limits on the selection of primary care
providers or providers of specialty medical care
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Conditions or limits applicable to obtaining
emergency medical care
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Provisions requiring preauthorizations or utilization
review as a condition to obtaining a benefit or service under the plan
The SPD must also explain how plan benefits may be obtained and the
process for appealing denied benefits.
ERISA also requires that SPDs be updated periodically. Furthermore,
ERISA requires disclosure of any material reduction in covered services or
benefits to participants and beneficiaries generally within 60 days of the
adoption of the change through either a revised SPD or a summary of
material modification (SMM). Material changes that do not result in a
reduction in covered services or benefits must be disclosed through an SMM
or revised SPD not later than 210 days after the end of the plan year in
which the change was adopted.
The department’s claims procedure regulation describes your right to
get an answer from your health plan regarding your health benefit claim.
The regulation protects you – providing for a timely response by
describing the time frames for a decision, providing for a fair process by
describing the standards for a decision, and providing for meaningful
disclosure by describing the notice and disclosure that you are entitled
to receive from your plan. Look to the SPD for information on your health
plan’s claims procedure.
This fact sheet has been developed by the U.S.
Department of Labor, Employee Benefits Security Administration,
Washington, DC 20210. It will be made available in alternate formats upon
request: Voice phone: 202.693.8664; TTY: 1.202.501.3911. In addition, the
information in this fact sheet constitutes a small entity compliance guide
for purposes of the Small Business Regulatory Enforcement Fairness Act of
1996.
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