By: HUB’s EB Compliance Team
On September 27, the three agencies that issue rules on the Affordable Care Act and related laws issued part 61 in their series of FAQs. These latest FAQs now require that prescription drug information be included in the machine readable files (see more on that here). They also remove the blanket safe harbor for plans that do not have networks (like reference-based pricing plans).
Brief Background
As part of the move toward transparency, a 2020 Transparency in Coverage rule requires health plans to post on a public-facing website three machine-readable files (MRFs). The files are:
- One showing in-network negotiated rates.
- A second showing out-of-network allowed amounts and historical payments.
- A third related to prescription drugs.
In 2021, the agencies effectively suspended the requirement for including the prescription drug file. Due to some additional prescription drug reporting (sometimes called RxDC reporting) required by the Consolidated Appropriations Act, 2021, the agencies said they would not enforce the prescription drug MRF requirement.
Rx MRF
These latest FAQs now remove that suspension. This means employers, particularly those with self-funded plans and a carved out pharmacy arrangement, will now need to work with their vendors to get the prescription drug machine-readable file up and posted.
The troubling part of the FAQs is the lack of an implementation date. In other words, the prior guidance said they would not enforce the MRF requirement for prescription drugs, and this latest FAQ says they now will enforce it. The guidance does say that they are developing technical requirements and a timeline that takes into account the fact that plans likely were not prepared for this. This is helpful, but it does leave plan sponsors and their service providers a bit in limbo given that the enforcement safe harbor is technically gone.
Alternative Enforcement
The new FAQs also remove the MRF enforcement safe harbor that apply to alternative payment arrangements. In April 2022, the agencies said they would not enforce the MRF requirement on plans that had alternative arrangements that did not allow them to disclose specific in-network or out-of-network dollar amounts. For example, reference-based pricing plans, or plans that only pay a percentage of billed charges, may not have a specific dollar amount they pay for particular items or services.
The new FAQs state that, while the blanket safe harbor is gone, the agencies still plan to take a case-by-case approach with these types of plans. If a plan can demonstrate that compliance with the rules would have been extremely difficult or impossible, then the agencies say they will not pursue an enforcement action against that plan. Plans should still try to follow the technical guidance available on the CMS Github site.
If it is nevertheless prohibitively difficult to report dollar amounts, plans may be able to report the percentage of billed charges that will apply or provide additional context in open text fields, as described in the April 2022 FAQs. In short, these plans should do their best and document why reporting dollar amounts is not possible or practical. Here again, employers that maintain these types of plans should work with the vendors (if they have not already) to get MRFs posted as close to the standard specifications as possible.
Takeaways
While the preparation of MRFs largely belongs to the employer’s plan vendors, employers should check in with them to ensure that MRFs are being prepared. Employers will then need to ensure that the links to those MRFs are posted on a public website. While the MRFs themselves are nearly impossible (if not completely impossible) for humans to read, the hope is that these files will eventually lead technology vendors to create transparency tools.
If you have any questions, please contact your HUB Advisor. View more compliance articles in our Compliance Directory.
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