What are the requirements for a Summary Plan Description (SPD)?

The summary plan description, or SPD, provides participants and beneficiaries with information on the coverage and operation of the plan, including key participation dates, how service and benefits are calculated, when benefits go effective, and how to file claims.

The administrator is legally required to send the SPD, free of charge, to all group health plan participants within 90 days after the employee becomes a participant in the plan. An updated SPD must be furnished every 5 years if changes are made to SPD information or the plan is amended (otherwise, it must be furnished every 10 years).

Per guidance from the Department of Labor, SPD plans must include descriptions of the following:

• Cost-sharing provisions, including premiums, deductibles, coinsurance and copayment amounts for which the participant or beneficiary will be responsible
• Annual or lifetime caps or other limits on benefits under the plan
• The extent to which preventive services are covered under the plan
• Whether, and under what circumstances, existing and new drugs are covered under the plan
• Whether, and under what circumstances, coverage is provided for medical tests, devices and procedures
• 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
• Conditions or limits on the selection of primary care providers or providers of specialty medical care
• Conditions or limits applicable to obtaining emergency medical care
• 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.

Delivery Methods

The administrator must deliver the SPD to participants by means “reasonably calculated to ensure actual receipt”.

Permissible delivery methods include:

• Hand delivery
• First class mail
• Electronic, if employee has work-related computer access as a part of their daily duties and:
  • Employer takes measures reasonably calculated to ensure that the system for furnishing documents results in actual receipt of transmitted information (e.g., using return-receipt or notice of undelivered electronic mail features);
  • The electronic notice informs the recipient of the document’s significance;
  • The electronic notice advises the recipient that a paper copy is available upon request at no charge; and

If a disclosure includes personal information relating to an individual's accounts and benefits, the plan administrator must take reasonable and appropriate steps to safeguard the confidentiality of that information.