Most Employers not Ready for Health Care Reform Disclosures

According to the annual survey of U.S. companies and their current and future compliance communication plans and processes, focusing on Summary Plan Descriptions (SPDs), while 81% of employers plan to update their SPDs for plan design and Affordable Care Act (ACA) changes this year, they continue to wrestle with cost containment and resource strain for the implementation and review process required to execute SPD changes.  

More than 60% of respondents don’t know their average spend per participant to create, store and distribute SPDs (30% estimate they are spending between $10 and $20).   

Employers are recognizing that SPDs serve as a valuable source of information for employees, but less than half expect to be ready to distribute Summaries of Benefits and Coverage (SBCs) by the end of March, the deadline for initial SBC production at the time of the survey.  

The number of employers using electronic distribution (either e-mail, posting to a portal or intranet or CD) continues to hover around 81%. As employers continue to search for alternatives to print distribution, posting to a portal (with a note that a paper copy was available on request) is the preferred method, with 88% of respondents reporting that they took this approach for active non-union employees.  

“With the increased communications requirements of ACA and the DoL’s fee disclosure rules, employers need to take steps to reduce costs in every area. This means producing fewer documents, designing simpler documents, and utilizing technology to reduce the costs of managing, maintaining and distributing content,” said David O’Connell, principal analyst, Nucleus Research. “Through increased automation, companies can achieve and document their compliance while also reducing costs.”  

“The ACA places an increased focus on the importance of accurate, timely and easy to read communication documents,” said Thomas Barker, partner, Foley Hoag LLP and former general counsel at the United States Department of Health and Human Services. “All employers both large and small need to build in protective processes to assure that they are ready to comply with new and changing requirements as the policies for ACA continue to become available.”