Executive Summary
• Group Health Plan (GHP) Responsible Reporting Entities (RREs) will be required to report prescription drug coverage information to CMS beginning January 1, 2020. While such reporting already exists, this information request is expanded and will include additional questions.
• For insured plans, the RRE is the insurer unless a TPA is used to process claims – in that case the TPA would be the RRE.
• For self-funded plans, the RRE is the TPA.
• For employers that are self-funded and self-administer their plan without a TPA, the employer would be the RRE.
Background
The Centers for Medicaid and Medicare (CMS) recently issued guidance and supporting revisions to the Medicare Secondary Payer (MSP) User Guide explaining that RREs have the option to submit this additional mandatory expanded information as part of their already mandatory MSP reporting. Plans and plan sponsors may already voluntarily provide CMS creditable coverage reporting for prescription drug coverage available to Medicare-eligible employees. This reporting helps Medicare determine who pays primary where Medicare and private insurance coordinates. While this information reporting is now mandatory beginning January 1, 2020, most employers would not be deemed an RRE. However, they should work with the insurers and PBMs to provide them the information needed to complete this reporting. For complete details on the new mandate, see the Leavitt article.
FAQ Updates
Most of the updates were made in the form of clarifications, including:
Q/A 1 clarifies that information does not include actual prescription drugs prescribed.
Q/A 2 reports that the RRE should use the effective date of the drug coverage even if before the 2006 implementation of the Medicare Part D program.
Q/A 3 clarifies who is the RRE:
Question 3: In the case of reporting primary prescription drug coverage, which entity will be considered the RRE?
Answer 3: The entity considered to be the RRE for the purpose of reporting primary prescription drug coverage will depend on how the plan sponsor structures its contracts for medical, hospital, and prescription drug coverage. It should not be assumed that the RRE will be the entity that has direct responsibility of processing and paying the prescription drug claims.
For example: If the plan sponsor contracts with an insurer or TPA for hospital, medical and prescription drug coverage, then the insurer/TPA is considered the RRE and will be required to report primary prescription drug coverage. In this case, it does not matter whether the insurer/TPA administers the prescription drug coverage directly or contracts administration of prescription drug coverage to a third party such as a Pharmacy Benefit Manager (PBM).
However, if the plan sponsor contracts with an insurer or TPA for medical and or hospital coverage, but then independently contracts with another third party such as a PBM to administer prescription drug coverage, then that third party or PBM is considered the RRE.
New FAQs
Q/A 11 that contains technical directions for adding the prescription drug coverage information to previously submitted information.
Q/A 12 addressing HRA reporting where balances are $5,000 or greater.
Editorial Comments
In most cases, the insurer, PBM or TPA is the RE. Employer / plan sponsors nonetheless should be aware of this requirement should additional information is sought by those entities to effectuate this reporting for the employer’s plan.
Resources
The updated FAQs can be found here.
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