The Employee Retirement Income Security Act (“ERISA”) requires group health plans to provide a summary of material modifications (“SMM”) in some cases, and a summary of material reduction in benefits (“SMR”) in some cases. Both ERISA and the Affordable Care Act (“ACA”) require SMMs. So,what are the differences?
Other Key Definitions:
Summary Plan Description is a summary of key terms of the plan document, written in language understandable to the average participant, which generally must be provided to new participants and updated every five years.
Summary of Benefits & Coverage is a short summary of specific benefits and coverage information which must be provided at open enrollment, initial enrollment, special enrollment and upon request.There is a specific template that must be used which is available on the websites of the Department of Labor and Health and Human Services.
¹ Note that the ACA adds this requirement to ERISA, so this is technically also an ERISA requirement, simplified for this discussion for purposes of distinction.
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