Transparency in Coverage Rule and Related Mandates: Latest News

Issuers, self-insured employers, and third-party administrator (TPA) partners be aware: It’s time to act on price transparency. Later this year, the Centers for Medicare & Medicaid Services (CMS) is expected to implement and enforce the Transparency in Coverage requirements applicable to health insurance issuers and self-insured group health plans.

Specifically:

  • Effective July 1, 2022, plans and issuers were required to disclose in-network rates and out-of-network allowed amounts in machine-readable files on a public-facing website. However, disclosing certain prescription drug prices in a separate file (called the “Prescription Drug File”) is on hold until the Federal departments issue guidance (1) implementing this requirement or (2) rescinding the Prescription Drug File altogether.
  • Effective January 1, 2023, plans and issuers must offer participants access to an online cost-sharing liability tool, allowing participants to request certain information – including their out-of-pocket exposure – for 500 medical items and services that the federal departments deem shoppable (as listed in the final regulations).
  • Effective January 1, 2024, plans and issuers must provide information for ALL medical items and services covered by the plan/policy (no longer just the 500 shoppable items listed in the final regulations).

Chris Condeluci

Healthcare Bluebook spoke with Chris Condeluci, a healthcare legal and policy expert – and founder of CC Law & Policy – who provides counsel to employers, TPAs, and other stakeholders in the fully-insured and self-insured markets.

Prior to founding CC Law & Policy, Condeluci served as Counsel to the U.S. Senate Finance Committee where he participated in developing portions of the Affordable Care Act (ACA), including the ACA exchanges, state insurance reforms, and taxes enacted under the law.

Q&A with expert Chris Condeluci

Condeluci shares his perspective on industry readiness and what’s coming next on the transparency front. Immediately following the interview is a table containing information related to effective dates and enforcement standards.

Will the Transparency in Coverage regulations be delayed?

Condeluci: While there is still speculation about what will and won’t happen, CMS continues to signal that the July 1st effective date for publicly disclosing in-network rates and out-of-network allowed amounts is STILL on track. So, unless and until we hear differently, issuers, plans, and their TPA partners need to be working toward compliance now, if they are not already. July 1st is right around the corner.

What is your sense of the market’s readiness?

Condeluci: Price transparency is a big deal and the manner in which plans and issuers are required to disclose this information – for example, through machine-readable files – is generally new to our industry. Understandably, employers are overwhelmed trying to figure out how to be compliant. I continue to field questions from TPAs on how certain information should be input into the machine-readable files, and how plans are expected to comply if they cannot access the necessary pricing data from a medical provider or the owner of a provider network.

The bottom line is that stakeholders are taking compliance seriously, but they continue to struggle to comply due to some practical and operational issues. But help is available, so my recommendation is to look around.

What is keeping people up at night as they think about looming deadlines?

Condeluci: As I noted, TPAs and their self-insured employer customers are not getting the data they need to comply. This is a long-standing problem, and to your question, is something that has kept TPAs and employers up at night.

There are also lingering questions about unique plan designs and reimbursement arrangements like plans with tiered networks, or wrap networks, or even arrangements with no network. How are these plans/arrangements supposed to identify their in-network rates? How should the rates be disclosed in the machine-readable files?

Another requirement that is not set forth in the Transparency in Coverage Rule – but is a transparency-related requirement enacted into law through the No Surprises Act – is contributing to some sleepless nights as well.

This particular requirement is the Advanced Explanation of Benefits (AEOB). Originally effective January 1, 2022, the federal departments announced a non-enforcement period until implementing guidance is ultimately issued. To date, no guidance has been released.

What’s holding the AEOB requirement back? There is yet another transparency-related provision that requires medical providers to send the plan or issuer a good-faith estimate of the cost of a scheduled medical procedure, which must then be included in the AEOB. This good-faith estimate provision is also on hold because the federal departments have yet to issue implementing guidance. So how can plans/issuers fully comply with the AEOB requirement? They can’t.

BUT, it is advisable that plans and issuers start developing an AEOB template and then populate the template with as much information as possible. Then, once all of the implementation guidance is released – and all of this information starts flowing – plans/issuers can easily flip the switch and comply.

What other transparency-related requirements are on the horizon?

Condeluci: A new provision of the law is actually effective now, which prohibits medical providers and owners of provider networks from keeping pricing and claims data from a health insurance issuer and the sponsor of a self-insured plan. It also requires providers and owners of provider networks to share quality of care information with the issuer/plan sponsor.

This new provision should help those plans and TPAs that are finding it difficult to get the necessary data to comply with the Transparency in Coverage Rule. And, it could jump-start a discussion of how quality-related data could and should be disclosed.

Issuers, plans, and TPAs must also pay attention to a number of other provisions of the No Surprises Act, such as the requirements to update provider directories and to disclose in-network deductibles and out-of-pocket limits on insurance ID cards; and reporting certain PBM-related information to the Federal government, and even the requirement for brokers and consultants to disclose the amount of compensation paid to them by the health plan.

With respect to updating provider directories and disclosing information on ID cards, the federal departments should be issuing implementation guidance soon. In the meantime, plans and issuers are expected to undertake a good-faith effort to comply with the statute. Same with the broker/consultant disclosure rules, stakeholders should undertake a good-faith effort to comply with the statute and existing rules applicable to retirement plans. The PBM reports are delayed until December 27, 2022.

Are you hearing any buzz about potential quality reporting requirements in the future?

Condeluci: The data-sharing provision noted above requires the disclosure of quality-of-care information. However, identifying what constitutes quality has been difficult for industry experts. There are a number of organizations dedicated to coming up with a uniform definition of quality that is acceptable to all industry stakeholders. But, that is still a work-in-progress.

Having said that, reporting quality data is the next big frontier in transparency. The federal departments want to add a quality component to the Transparency in Coverage Rule while issuers, plans, TPAs, and others are definitely pushing hard for an industry-standard on what constitutes quality.

Reference Table: Effective Dates and Enforcement Standards

Transparency in Coverage Rule & No Surprises Act Timeline

Additional Resources:

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