New Summary of Benefits and Coverage (SBC)

When a health plan makes a significant mid-year change, an updated SBC must reach participants at least 60 days before the change takes effect.

See the Step-by-Step ProcessView the Checklist
What An updated SBC reflecting new plan terms, distributed to participants before a significant mid-year plan change takes effect.
Who All employers sponsoring group health plans, fully-insured and self-funded, when plan benefits or coverage change materially outside of open enrollment.
When At least 60 days before the effective date of the change. The clock starts from the decision to make the change, not from when participants are notified.
Risk $1,443 per-failure penalty for willful failures to provide the SBC (2026 rate, unchanged from 2025; adjusts annually for inflation), plus potential excise taxes.
60
Days before the change

For a significant mid-year modification, the updated SBC must be distributed at least 60 days before the effective date.

7
Business days on request

Any participant may request the current SBC at any time; provide the most current version within 7 business days.

Trigger Timing Notes
Significant plan modification outside of renewal At least 60 days before effective date Updated SBC must reflect the new plan terms. Request it from your carrier or TPA as soon as the change is decided; don't wait until 60 days out to start.
At renewal / open enrollment With open enrollment materials Standard annual SBC distribution, covered on the general SBC page. If changes also take effect mid-year before renewal, the 60-day rule applies to those separately.
Upon request Within 7 business days Any participant may request the current SBC at any time. Provide the most current version reflecting all changes.
Trigger: Significant mid-year plan modification
Timing: At least 60 days before effective date
Notes: Request the updated SBC as soon as the change is decided.
Trigger: At renewal / open enrollment
Timing: With open enrollment materials
Notes: Standard annual distribution; mid-year changes still need the 60-day rule.
Trigger: Upon request
Timing: Within 7 business days
Notes: Provide the most current version reflecting all changes.
  • Description of the plan change: Exact terms of what is changing (benefits, cost-sharing, limits, covered services) and the effective date. This is what you provide to the carrier or TPA so they can update the SBC accurately.
  • Current SBC: The version most recently distributed, so you can confirm what's changing and that the update is complete.
  • Distribution list: All current participants and beneficiaries who must receive the updated SBC.
  • Updated SBC from carrier or TPA: For self-funded plans that need to produce their own SBC, see the CMS template link in Templates & Resources below.
1
Confirm the change is significantNot every plan tweak triggers a new SBC. A change is significant if it materially affects covered benefits, cost-sharing, or other SBC content. When in doubt, update; the cost of distributing an unnecessary SBC is low, the cost of missing a required one is not.
2
Request the updated SBC immediatelyAs soon as the change is decided, contact your carrier or TPA and provide the exact change details. Don't wait; you need the updated SBC in hand well before the 60-day deadline to allow time for distribution.
3
Review for accuracyConfirm the updated SBC correctly reflects the new plan terms, effective date, and all other SBC fields. Do not distribute a draft or unreviewed version.
4
Distribute at least 60 days before the effective dateSend to all participants and beneficiaries via a permitted delivery method. Document the distribution date; it must be no later than 60 days before the change takes effect.
5
File and documentRetain the final SBC, the distribution list, and proof of delivery.
  • Format: Must use the federal standardized SBC format. No substitutions or reformatting; the carrier or TPA produces it in the correct format.
  • Cost: Must be provided free of charge to all participants and beneficiaries.
  • Paper or electronic: First-class mail or hand delivery satisfies the requirement. Electronic delivery is permitted if ERISA e-disclosure rules are met.
  • Uniform Glossary: The federal Uniform Glossary must accompany the SBC or be made available online with a notice of availability. For links, see the general SBC page, Templates & Resources.
  • Final SBCThe updated SBC as distributed, with version date.
  • Distribution listConfirmation of who received it.
  • Proof of deliveryMailing log with postmark date, or electronic delivery confirmation with timestamp.
  • RetentionRetain with plan records; 6 years minimum.

Common traps

Starting too late: Employers often decide to make a plan change, then contact the carrier two weeks before the effective date and realize the SBC can't be distributed in time. The carrier needs time to prepare the updated SBC, and you need 60 days for distribution. Contact the carrier the day the change is decided.
Distributing before the SBC is finalized: Distributing a draft or placeholder SBC and following up with the real one doesn't satisfy the requirement. The SBC distributed must reflect the actual final plan terms.
Forgetting beneficiaries: The SBC must go to participants and beneficiaries currently receiving benefits, not just enrolled employees. Include covered dependents and COBRA participants on the distribution list.
Assuming the carrier handles distribution: Carriers typically produce the updated SBC but do not always handle employer distribution obligations. Confirm with your carrier what they cover and what falls to you.

FAQs

What counts as a "significant" plan modification requiring an updated SBC?
Any material change to the plan's benefits, cost-sharing, covered services, or other SBC content. Changes to deductibles, out-of-pocket maximums, copays, covered services, and network structure would all qualify. Minor administrative changes that don't affect SBC content do not require an updated SBC.

Does an updated SBC replace the SMM?
No, these are separate obligations. The SBC update (60-day advance notice) and the SMM (60 days for benefit reductions, 210 days for other changes) are both required when plan terms change materially. Providing an updated SBC does not satisfy the ERISA SMM requirement, and vice versa. See the Summary of Material Modifications page.

What are the penalties for missing the 60-day distribution deadline?
Willful failures to provide the SBC carry a penalty of $1,443 per affected individual (2026 rate, unchanged from 2025; adjusts annually for inflation under the Federal Civil Penalties Inflation Adjustment Act). Excise taxes may also apply under the ACA.

  • Multiple plan options affected simultaneously: If a mid-year change affects more than one plan option (such as both the PPO and HDHP), each plan option requires its own updated SBC. Coordinate with the carrier or TPA to ensure all updated SBCs are ready at the same time.
  • Carrier vs. employer distribution responsibility: Fully-insured plan carriers may have contractual obligations to distribute SBCs directly to participants. Confirm in writing what your carrier covers; if they handle distribution, get confirmation with timestamps. If they don't, the obligation falls to the employer regardless.
  • Self-funded plans: The employer (or TPA acting on its behalf) must both update and distribute the SBC. Use the CMS blank template and work with your TPA or actuary to populate it accurately before the 60-day window opens.
  • Change decision made less than 60 days before effective date: If a plan change is decided with less than 60 days before it takes effect, you face a compliance problem. In this situation, consult with ERISA counsel; the options are limited and the penalties for non-compliance are real.

For fully-insured plans, your carrier produces the updated SBC; use the checklist below to manage the process. For self-funded plans that need to build the SBC, the CMS template link is below.

The Uniform Glossary links are on the general SBC page, Templates & Resources.

CMS Blank SBC Template (self-funded and HRA plans)

  • CMS Blank SBC Template (Word): fill in with your plan's updated data. Work with your TPA or actuary to populate the plan-specific fields accurately.

Mid-Year SBC Update Checklist

  • ☐ Plan change identified and confirmed as significant (materially affects SBC content)
  • ☐ Effective date of change established
  • ☐ 60-day distribution deadline calculated and calendared (distribute by: _______________)
  • ☐ Carrier or TPA contacted immediately with exact change details and effective date
  • ☐ Updated SBC received from carrier or TPA
  • ☐ Updated SBC reviewed for accuracy: new terms, effective date, all affected fields
  • ☐ Distribution list confirmed: current participants, beneficiaries, COBRA participants
  • ☐ Delivery method confirmed (paper mail or electronic per ERISA e-disclosure rules)
  • ☐ Uniform Glossary included or notice of availability provided with the SBC
  • ☐ Updated SBC distributed at least 60 days before effective date
  • ☐ Distribution date documented (mailing log or electronic delivery confirmation with timestamp)
  • ☐ Final SBC and proof of distribution filed, retain minimum 6 years
  • ☐ SMM also prepared and distributed per applicable deadline, see the Summary of Material Modifications page