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Departments Issue New FAQs on Transparency in Coverage Reporting Requirements

On April 19, 2022, the Department of Labor (DOL), Health and Human Services (HHS), and the Treasury released two FAQs regarding an upcoming compliance requirement under the Transparency in Coverage (TiC) rules.

The guidance adopts an enforcement safe harbor for health plans and insurers reporting certain types of in-network rates under the TiC rules. The TiC rules were issued in November 2020 and cover implementation of the price transparency requirements under the Affordable Care Act (ACA). Under the TiC rules, non-grandfathered group health plans and health insurers must disclose information in machine-readable files on a public website regarding:

  • In-network provider rates for covered items and services;
  • Out of Network allowed amounts and billed charges for covered items and services; and
  • Negotiated rates and historical net prices for covered prescription drugs

The machine-readable files are applicable for plan years beginning on or after January 1, 2022. However, enforcement of the requirements related to disclosing in-network and out-of-network data has been deferred until July 1, 2022. The enforcement of the requirement related to prescription drugs is deferred pending further rulemaking.

The new guidance explains that the TiC rules require plans and insurers to publish an in-network rate file. This file must express rates as a dollar amount and may include negotiated rates, underlying fee schedule rates, or derived amounts for covered items and services. Because some plans and insurers report rates under “percentage-of-billed charges” or some other alternative arrangement, the FAQs establish two safe harbors. The first allows plans and insurers to report a percentage number instead of a dollar amount. Plans using this safe harbor should report the percentage according to these specific formatting requirements provided by the Departments.

The second safe harbor states that if in-network rates and services are provided under another alternative reimbursement arrangement and require additional context, plans and insurers may use an open text field that includes a description of the formula, variables, methodology, and other information necessary to understand the arrangement. However, this method may only be used if the Department’s technical implementation guidance does not support the arrangement.

Both safe harbors may be reevaluated in the future as fee schedules become more widely available. With the July 1st deadline rapidly approaching, plan sponsors should reach out to their insurance carriers to ensure compliance. f you have any questions about these FAQs or your compliance responsibilities, contact your OneDigital consultant.

For additional information, please contact your OneDigital account team with any questions.

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