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How to Read the Summary of Benefits & Coverage in Health Insurance

Even though health insurance is for everyone, policies often contain language only a medical professional could understand. With so much jargon to sift through, health plans can be confusing and overwhelming for the average person. That’s why the Affordable Care Act requires that every health insurance company provides a Summary of Benefits and Coverage (SBC) for every plan they offer. 

SBCs break down important information about health insurance plans in plain and concise terms — so you can understand your health plan options, without getting bogged down by tons of fine print. In this blog, we’ll explain how to read the summary of benefits and coverage, so you can make informed decisions about your health insurance — even if you don’t have a medical degree.

What is a Summary of Benefits and Coverage (SBC)?

Think of your summary of benefits like your cheat sheet to your health insurance plan. You’ll find essential information like how cost-sharing is structured, what services are covered (and aren’t), benefits, and exclusions, all in your SBC. Health insurance companies must provide these guides because they make it easy to understand your options, estimate healthcare costs, and compare plans.

Summary of Benefits vs Explanation of Benefits

A summary of benefits gives an overview of what you might pay for certain services. You can look at a summary of benefits, even before enrolling in a plan. An explanation of benefits (EOB), on the other hand, is something you only see once you’ve received treatment. After you’ve seen a doctor, your insurance company will send you an EOB, detailing how they processed your claim. The EOB will show the services you received, how much the health insurance company paid, and what you might owe. If you owe a balance, you might still receive a bill after you get your EOB. Don’t agree with your bill? Learn how to fight a medical bill.

What Should Your Summary of Benefits Include?

While every health insurance company might organize and word their SBC differently, here’s a basic look at what you should see in your summary: benefits, coverage, cost-sharing structure, and exclusions. 

Here’s a more detailed list of the sections you can expect in a summary of benefits:

  • General information on what your health plan covers
  • A glossary of terms
  • Services and treatments that aren’t covered
  • A list of limits and exclusions
  • A detailed example of how your plan would cover a common medical event
  • Your rights in the event that you are dissatisfied with your coverage
  • Details on the ACA’s requirements for minimum essential coverage and value standards
  • An explanation of the plan’s prescription medication coverage

If you can’t find the answers you’re looking for in your SBC, it should also contain a phone number you can call to be connected to a member of the carrier’s customer support team.

Where to Find Your Summary of Benefits and Coverage

Where you’ll find your SBC will depend on how you’re receiving health insurance. If your employer provides health coverage as a benefit, review a summary of coverage when choosing your plan. Someone from the Human Resources department should provide this to you. If you’re shopping for a plan on the ACA health insurance marketplace, you can view a SBC for each plan on the platform before enrolling. 

Already have health insurance? Simply log into your carrier’s online portal, where you should be able to access a digital copy of your SBC. Our helpful AI assistant can also quickly pull this up for you, and you can keep it in your digital wallet for easy retrieval.

How to Read Your Summary of Benefits and Coverage

It’s a good idea to review the full summary of benefits for any plan you’re interested in enrolling in. However, for times when you're looking for quick answers to specific answers, it can be helpful to know how to navigate your SBC at a glance. Below we’ll provide summary of benefits and coverage example sections, to help you better understand this important document.

Header with Detailed Information About the Plan

The top of every SBC should contain a header with the following information:

  • Name of the insured
  • Name of the plan + tier (i.e. bronze, silver, gold, or platinum)
  • Coverage period
  • Plan type (HMO, PPO, EPO, etc)

It’s important to remember that the coverage period doesn’t always align with the calendar year, especially if you enroll during a Special Enrollment Period.

The Most Important Questions

Individuals just like you have been reaching out to insurance companies for decades with questions about coverage. That’s why most insurers have compiled a list of the most commonly asked questions  — and their answers — in their SBCs. Here are some of the questions you’ll likely find answers to in this section:

  • What is the individual/family deductible?
  • For which services does the deductible not apply?
  • Does the plan provide any coverage for out-of-network providers?
  • What is the out-of-pocket maximum?
  • Are there coverage limits for the year?
  • Do I need a referral to see a specialist?
  • Where can I find a list of in-network providers?

If you do not find the answer to your question in this section, call the provided customer support number and a representative should be able to assist you. Alternatively, you can ask our AI tool, which can scan an entire policy in seconds to provide you with instant answers.

Glossary of Terms

From “co-insurance” to “Health Savings Account” and “allowed amount,” you’ll come across more than a few confusing terms in your SBC. A summary of benefits and coverage will contain a Glossary of terms, where you can find the definitions for important medical words and phrases. It’s a good idea to skim this before reading the rest of your SBC because it will make it easier to understand the other sections.

Common Medical Events

Want a general overview of what you might pay for common services? Review the Common Medical Events section, where you’ll find a breakdown of coverage for things like specialty visits, labwork, or routine screenings. The insurance company will likely provide this in the form of a table, with the following columns:

  • Service/visit type (i.e. PCP, specialist, x-rays)
  • What you’ll pay if you stay in the network (co-pay, co-insurance, applied deductible)
  • What you’ll pay if you go out of network (co-pay, co-insurance, applied deductible)
  • Limitations and exclusions 

This is a broad overview of your potential out-of-pocket costs. However, for an in-depth look at what a bill could be, you’ll review the “coverage examples” section (read on).

Exclusions and Additional Benefits

So far, we’ve covered sections offering information on typical healthcare situations. But, what if your health status isn’t exactly typical? Look to the Exclusions and Additional Benefits section, where you can find exceptions to the rules, and benefits that fall outside of routine/common services. Every plan is unique, but common exclusions include:

  • Alternative medicine
  • Cosmetic procedures
  • Weight loss surgery
  • Dental care
  • Vision care
  • Midwifery

Meanwhile, you might be surprised that some plans offer these additional benefits:

  • Weight loss programs
  • Acupuncture
  • Substance abuse treatment
  • Hearing aids
  • Help to quit smoking
  • Gym memberships

If you have healthcare needs or goals that fall outside what’s considered “common,” be sure to check this section.

Consumer Protection

As a consumer, you’re entitled to certain rights. If you believe your health insurance company has failed to provide you with coverage to which you’re entitled or violated ACA compliance standards, reference this section. Here you’ll find information on topics like:

  • Minimal essential coverage standards: This refers to the ACA requirement that plans provide the minimal coverage necessary to avoid penalties associated with not having health insurance.
  • Minimum value standards: This standard requires health insurance companies to pay for at least 60 percent of your medical costs. 
  • Your right to continued coverage: Should you lose your insurance, certain qualifying life events, such as job loss, death of primary policyholder, or a divorce, entitle you to continued coverage.
  • Grievance and appeals rights: You have the right to contest a carrier’s choice to deny a claim or deny you coverage.
  • Language access services: This ensures that individuals with limited English proficiency have access to interpretation and translation services to fully understand and utilize their health insurance benefits.
  • Nondiscrimination and accessibility requirements: This mandates that insurance providers offer equal access to coverage and services regardless of race, color, national origin, sex, age, or disability, and provide accommodations for individuals with disabilities.

Hopefully, you never need this section. But if you feel your insurance company has treated you unfairly, it’s good to know that this information is here.

Coverage Examples

At times, your medical treatment might involve multiple aspects of your plan, such as a specialist visit, lab work, and prescription medications. That’s when estimating your total cost can get tricky, which is why in every summary of benefits, examples of complex bills are usually provided. 

One example could include a visit to an OBGYN, along with bloodwork, and an antibiotic. The example will list each type of service provided (so in this case, a specialist, a lab, and a prescription). Then, for each service, it will show you:

  •  The total amount billed to your insurance
  • The amount of your deductible that was applied
  • The co-pay
  • The co-insurance
  • What your insurance paid
  • What you paid/owe

These give you an idea of how various elements of your plan come together and help you better predict your financial liability. 

How to Use an SBC to Choose the Right Plan

Now that you understand how to read a Summary of Benefits and Coverage, you can use your SBC to guide you in selecting the right plan for your needs. Here are some things to consider when choosing coverage:

  • The price of the premium: Make sure you can afford to make this monthly payment.
  • Cost-sharing: This includes co-pays, your deductible, and co-insurance rates.
  • In-network providers: Make sure they’re conveniently located and have good reviews.
  • Out-of-network coverage: If you need to see a doctor who isn’t in-network, make sure the plan provides out-of-network coverage.
  • Prescription coverage: If you take regular medication, make sure the plan covers it.
  • Limitations and exclusions: Need a particular service or treatment? Check the limitations and exclusions to see if it’s covered.

Once you’re comfortable reviewing SBCs, you can easily access these helpful documents for multiple plans and complete side-by-side comparisons.

Find the Perfect Plan 

Insurance ‘N You is here to empower you with tools and insights to help you navigate your plan options. In an insurance market that can feel complicated and crowded, having an informed ally makes a difference. We’re that ally. 

We think that finding coverage that revolves around you should be easy. Instantly compare health insurance quotes that meet your wellness and wallet goals. Once you’re all set up with a plan, you can store your important documents — including your SBC — in our helpful digital wallet

Need more help? Chat with our AI agent for instant insights, customized for you. Get your quote today

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