Compliance News | June 23, 2021
The Consolidated Appropriations Act of 2021 enacted both the No Surprises Act and a provision requiring group health plans and insurers to submit to the federal government information on prescription drug costs and spending from the previous year.
To gain a better understanding of the compliance issues, the Departments of Health and Human Services (HHS), Labor (DOL) and Treasury (the Departments) and the Office of Personnel Management (OPM) have released a request for information (RFI) asking for detailed responses to questions.
The deadline for responding to the RFI is July 23, 2021 at 5 pm (ET). At this point, the effective date for the first set of reporting remains December 27, 2021. For subsequent years, the deadline is June 1.
Group health plans are required to report the following information to the secretaries of the DOL and HHS about their prescription drug benefits for the previous plan year:
Using the information reported by plans, the Departments will analyze trends in overall spending and publish analyses intended to enable plans to negotiate fairer rates and lower prescription drug costs.
The Departments will post the first report no later than 18 months after is required. Thereafter, they will post the report every two years.
Questions in the RFI, which was published in the June 23, 2021 Federal Register, fall into several categories:
Key issues of interest to plan sponsors, who may wish to comment on the RFI, include questions concerning implementation challenges and operational concerns, such as reporting methods. In addition, the Departments ask what data is readily available to plan sponsors, and whether there are unique considerations for different types of plans (e.g., self-insured plans, multiemployer plans and plans that use a third-party administrator). The Departments also ask whether there are methods of aggregating data reports that they should consider.
The RFI is an opportunity to weigh in on the new prescription drug reporting requirements. Plan sponsors subject to the requirements should review these issues with their professional advisors to determine what challenges appear for reporting and how best to resolve them.
For additional information about the Consolidated Appropriations Act requirements, see Segal’s compliance plan.
This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.
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