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Prescription Drug Data Interim Final Rule Released

The Department of Health and Human Services, Department of Labor, and Department of the Treasury jointly released a fourth regulation in a series of new guidance on implementing certain provisions of the No Surprises Act.

The first three, which covered the prohibition on surprise medical bills, reporting requirements for air ambulance services, and how providers, facilities, and health plans can resolve payment disputes, were released earlier this year.

The newest interim final rule gives guidance on how group health plans and health insurance issuers can comply with the No Surprises Act's prescription drug and health coverage costs reporting requirement. As contained in the Consolidated Appropriations Act of 2021, the No Surprises Act requires health plans and health insurance issuers to report prescription drug data for 2020 and 2021 by December 27, 2022. Beginning in 2023, data must be submitted annually.

Who is required to comply?

The rule applies to group health plans and health insurance issuers that offer group or individual insurance coverage. The law applies to insured and self-insured group health plans, plans sponsored by state and local governments subject to the Public Health Service Act, and church plans subject to the Internal Revenue code.

Information that must be reported

Plans and health insurers must provide the department with information on prescription drug and other health care spending, including:

  • General information regarding each plan or coverage
    • Plan identifying information, e.g., plan number, issuer name, plan sponsor, the reporting entity
    • Plan effective and end dates
    • Number of participants, beneficiaries, and enrollees covered on the last day of the plan year
    • Each state in which the plan or coverage is offered
  • For each state and market segment, the following:
    • Enrollment and premium information, including average monthly premiums paid by employees versus employers
    • Total health care spending, broken down by type of cost (hospital care, primary care, specialty care, prescription drugs, wellness services), including prescription drug spending by enrollees versus employers and issuers
    • The 50 most frequently dispended brand prescription drugs (according to the total number of paid claims for prescriptions filled during the plan year)
    • The 50 costliest prescription drugs with the most significant increase in plan or coverage expenditures from the previous year as determined by total annual spending on each drug
    • The 50 prescription drugs with the most significant increase in expenditures between the year immediately preceding the plan year and the reference plan year
    • Prescription drug rebates, fees, and other renumeration paid by drug manufacturers to the plan or issuer in each therapeutic class of drugs, as well as for each of the 25 drugs that yielded the highest amount of rebates
    • The impact of prescription drug rebates, fees, and other renumeration on premiums and out-of-pocket costs

The information must be aggregated at the state/market level rather than separately for each plan. For specific standards and definitions on things like dosage strength, packet size, etc., see the interim final rule.

The Departments have invited public comment on the rule. Any comments are due by January 24, 2022. Although the first report does not need to be submitted until December 27, 2022, employers should begin discussions with their insurance carriers and/or third-party administrators to develop a game plan to comply. Employers should also review any relevant contracts to see if language needs to be updated so each party knows their responsibilities.

Don’t miss an update – visit OneDigital’s Compliance Confidence Fresh Thinking blog for the latest developments around employer compliance. Download the Compliance InfoBrief: Prescription Drug and Health Care Spending Reporting to review the latest regulations on reporting requirements.