March 20, 2009
CMS Updates Mandatory Insurer Reporting Requirements and User Guide
The Centers for Medicare & Medicaid Services (CMS) has revised its guidance on new data-reporting obligations for group health plans (GHPs) and their insurers and third party administrators (TPAs) that were effective January 1, 2009.1 The new data-reporting requirements were enacted in Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA) (Public Law 110-173).2 The rules will require insurers, third party administrators (TPAs) and a plan administrator or fiduciary of a self-insured/self-administered group health plan to collect data for certain classes of participants and beneficiaries—including Social Security Numbers (SSNs) or Medicare Health Insurance Claim Numbers (HICNs)—and electronically file the information with Medicare in accordance with detailed rules established by CMS.
This Capital Checkup summarizes key points from updated guidance issued by CMS in early March: (1) data relating to Health Reimbursement Arrangements (HRAs) does not need to be submitted until the fourth quarter of 2010; (2) data relating to stand-alone behavioral/mental health benefits does not need to be reported at all; and (3) it appears that both registration and account setup need to be completed between April 1 and April 30, 2009. Plan sponsors with self-insured and self-administered group health plans need to start the registration and account setup process as soon as possible on or after April 1, 2009.
As the April 30 deadline is fast approaching, affected plan sponsors should develop a compliance plan documenting the efforts they have made to meet the reporting standards.
Background: Who Must Register and Comply?
The following "Responsible Reporting Entities" (RREs) must register with CMS and report data:
- Health insurance companies,
- TPAs, defined as entities that pay and/or adjudicate claims on behalf of group health plans, and
- Plan administrators or fiduciaries of self-insured, self-administered group health plans. However, if the plan uses a TPA to pay claims, then CMS has stated that the TPA is the RRE.
RREs may use agents to submit reports on their behalf, but accountability for submitting accurate reports rests with the responsible entity, not the agent. Plan sponsors of self-insured, self-administered group health plans should have determined whether they are an RRE and whether an agent will be designated to report data, and they should now be making the decisions and gathering the information necessary to register and set up their RRE account with CMS.
Employer-sponsored plans that are fully insured do not have any reporting obligations. However, since the insurer does have a reporting obligation, many employers and multiemployer plan sponsors are receiving requests from insurers for SSNs and HICNs for plan participants, spouses and certain dependents.
Registration and Account Setup Deadlines Fast Approaching
Self-insured, self-administered group health plans that do not currently exchange data with Medicare using a Voluntary Data Sharing Agreement (VDSA) must register and set up their account on a secure Web site between April 1 and April 30, 2009. Initially it appeared that only the first step in the registration process (the application) needed to be completed by the end of April, but it now appears that account setup must also be completed during that time frame. The process is described in detail in Section 220.127.116.11 of the GHP User Guide Version 2.2 available on the CMS Web site.3 The registration and account setup process is very similar to that used to obtain the Medicare Part D Retiree Drug Subsidy.
The key steps that are part of this process include:
- The plan sponsor should name an Authorized Representative (a person with legal authority on behalf of the plan) and an Account Manager. CMS does not require that the Authorized Representative be a fiduciary.
- Either the Account Manager or Authorized Representative must begin the application process, but both will have to take an active role in completing registration and account setup. Consequently, both will need to dedicate time in April for this process.
- The registration application is completed online via the Coordination of Benefits Secure Web site (www.section111.cms.hhs.gov), which was not live as of the date of this Capital Checkup. Although the Web site is not yet available, the requirements for registration should be posted soon at the URL provided in the User Guide: www.cms.hhs.gov/MandatoryInsRep/Downloads/RegistrationOverview.pdf
- The Web site does not allow the application to be completed in one visit - it will validate the initial information and then send new ID numbers to the Authorized Representative, who must give them to the Account Manager to finish the application.
- To finish the application, the Account Manager provides contact information, creates a login ID, estimates the number of individuals about whom data will be submitted, enters the name and contact information of any agents to be used by the RRE, and selects a file transmission method. He or she may also invite Account Designees to register for login IDs. Account Designees may be RRE employees or agents, and they assist the Account Manager with the reporting process.
- After the application is completed online, a report will be sent to the Authorized Representative, who must review and approve it.
Once CMS receives the signed report, it will notify the Authorized Representative and the Account Manager via e-mail that the testing process can begin. (The testing period runs until July 1, 2009.)
Health Reimbursement Arrangements
Many benefits administrators and plan sponsors with HRAs have requested that CMS exempt HRAs from the reporting requirements in the same way that Health Flexible Spending Arrangements (FSAs) are currently exempt. This is because HRAs are generally not used without a companion health insurance plan that contains the actual claims information necessary to coordinate with Medicare, and HRAs do not keep records in the same manner as a claims-paying health insurer or administrator.
The revised CMS guidance gives RREs a reprieve in reporting information relating to HRAs. CMS has decided that quarterly reporting files do not need to be submitted on HRAs until the fourth quarter of 2010. CMS provided this extension to give plans time to gather the necessary information on HRA coverage. Absent further clarification from CMS, plans that self-administer only their HRA (and thus are RREs only with respect to HRA coverage) should still register and set up their account during April 2009 because the guidance does not explicitly state that registration and setup also may be delayed.
Stand-Alone Behavioral/Mental Health Benefits
The revised guidance adds stand-alone behavioral/mental health benefits to the list of benefits not subject to the new reporting requirements. Previously, CMS had stated that data need not be reported in connection with Health Flexible Spending Accounts, Health Savings Accounts, stand-alone vision coverage, and stand-alone dental coverage. CMS notes that (as with stand-alone vision/dental), RREs are still responsible for being aware of situations where behavioral/mental health services are covered by Medicare so that the plan pays primary for these services when required to do so.
Implications for Plan Sponsors
Self-insured, self-administered health plans should already have decided whether they will develop an electronic reporting capability or delegate the responsibility to an agent, and should be preparing to complete the registration process next month. As the deadline for registration and account setup approaches, these plans should develop a compliance plan that sets forth their strategy for complying with the law and provides evidence of both good faith efforts and delegation of responsibility in case the plan is audited by CMS. Plans that are insured, or that are self-insured but not self-administered, do not have to report data to CMS. However, they may be contacted by their TPA or insurer and encouraged to begin collecting data (especially SSNs or HICNs) relating to dependents who must be reported.
Information on reporting requirements, criteria and implementation deadlines is available in The Segal Company's January 2009 Bulletins, "Medicare Mandatory Insurer Reporting for Public Sector Health Plans" or "Plan Sponsors and Medicare Mandatory Insurer Reporting" (for multiemployer plans).
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As with all issues involving the interpretation or application of laws, plan sponsors should rely on their legal counsel for authoritative advice. The Segal Company is available to assist plan sponsors in complying with these reporting requirements.
- The implementation guidance is available through the following page of the CMS Web site: http://www.cms.hhs.gov/MandatoryInsRep. This information is continually updated. Of particular significance is the MSP Mandatory Reporting GHP User Guide, which CMS has already revised numerous times since the original posting. (Click on the following text to return to the Capital Checkup.)
- For information about the MMSEA, see one of The Segal Company's January 2009 Bulletins, "Medicare Mandatory Insurer Reporting for Public Sector Health Plans" or "Plan Sponsors and Medicare Mandatory Insurer Reporting" (for multiemployer plans). (Click on the following text to return to the Capital Checkup.)
- http://www.cms.hhs.gov/MandatoryInsRep/02_GHP.asp (Click on the following text to return to the Capital Checkup.)
Capital Checkup is The Segal Company's periodic electronic newsletter summarizing activity with respect to health care and related subjects. Capital Checkup is for informational purposes only. It is not intended to provide guidance on current laws or pending legislation. On all issues involving the interpretation or application of laws and regulations, plan sponsors should rely on their attorneys for legal advice.