Summary
Prescription drug reporting due to begin December 27, 2022 now has available a grace period until January 31, 2023 if the plan makes a good faith data submission on or before that date.
Background
As part of the Consolidated Appropriations Act (CAA) passed in 2021, prescription drug coverage transparency reporting (“RxDC”) was due to begin December 27, 2022 for the 2020 and 2021 calendar years (plan years will report annually as well regardless of the plan year dates). See the prior Leavitt Group article on RxDC for full details on RxDC reporting. In subsequent years, reporting for the prior calendar year will be due by June 1st the following year. The latest in many transparency rules to come into play since 2020, RxDC requires all health insurance issuers and group health plans to submit to the Centers for Medicare and Medicaid Services (CMS) specific information related to the cost, availability and types of coverages available to plan participants with the intent of increasing visibility into costs for others’ plans to increase competition and drive down costs.
Grace Period Now Available
On December 23, 2022, the Departments of Labor, Health and Human Services and Treasury (the Departments) issued Frequently Asked Questions (FAQs) providing for a grace period of just over one month if the insurance carrier or health plan makes a good faith RxDC reporting on or before that date. Meaning, the Departments will not initiate enforcement action against a plan that makes a good faith effort to submit the required information by January 31, 2023. Additionally, the FAQs provide clarifications and flexibilities, such as:
- Allowing multiple submissions by the same reporting entity, even for the same file.
- Email submissions to RxDCsubmissions@cms.hhs.gov for certain plans where reporting entity is only submitting plan lists, premium and life-years data and the narrative response, if no other data is submitted
- The emailed submission must include the plan list file, premium and life-years data (data file D1), and a narrative response. The submission may include optional supplemental documents. The name of each file should include the reference year of the submission, the plan list or data file type (e.g. P2, D1), and the name of the group health plan sponsor.
- Optional reporting for some data, such as vaccines, “Amounts not applied to the deductible or out-of-pocket maximum” and the “Rx amounts not applied to the deductible or out-of-pocket maximum.”
Employer Action Required
Most employers can rely on their third party service providers (e.g., Pharmacy Benefits Managers, Third-Party Administrators or other plan service providers) to provide the bulk of the reporting. Employers must enter into a contract in order to transfer liability to the third party, but this is only available for fully-insured plans. Self-funded plan sponsors will need to rely on third parties for reporting on some of the information but cannot transfer risk. However, we still recommend entering into a contractual arrangement with third parties who will assist with RxDC. Leavitt Group clients can reach out to their representatives for additional training available on RxDC.