This is the first installment of a two-part blog post series discussing the history of Federal policymaking to increase the transparency of medical prices and health claims data, followed on with a conversation about efforts self-insured health plan sponsors are taking to access their plan’s own data.
Rooted In the Affordable Care Act
The Federal government’s efforts to increase the transparency of medical prices and health claims data kicked into high gear starting in 2017, but these efforts are rooted in the development the Affordable Care Act (ACA), which was enacted into law back in March 2010.
In particular, the ACA required insurance carriers and self-insured health plans to disclose, among other things, information on cost-sharing and payments with respect to any out-of-network coverage.
This new requirement also called for carriers and plans to help their participants learn more about the amount of cost-sharing plan-holders would be responsible for through an online website.
In addition, the law gave the Department of Health and Human Services (HHS) the authority to determine “other appropriate information” that could – and should – be disclosed to group health plan participants.
Built Upon by the Trump Administration
Interestingly, the Obama Administration – which was responsible for developing and ultimately enacting the ACA – never implemented the above stated transparency requirements.
More interestingly though, is that the Trump Administration took hold of this statutory language and used it as legal authority to develop regulations requiring insurance carriers and self-insured plans to disclose to participants – through an electronic, online “self-service tool” – specific information about medical items and services covered under the plan, along with cost-sharing exposure (commonly referred to as the Cost-Sharing Liability Tool).
In accordance with HHS’s authority to determine “other appropriate information” that could – and should – be disclosed to participants, the Federal Departments also required carriers and self-insured plans to disclose their in-network rates and out-of-network allowed amounts through “machine-readable files” (MRFs) on a public website.
These above stated transparency requirements were memorialized in the “Transparency in Coverage (TiC) Rule,” under which the requirement to disclose in-network rates and out-of-network allowed amounts on a public website was effective July 1, 2022, while the requirement to make available pricing and out-of-pocket payment information for 500 “shoppable” medical items or services through the Cost-Sharing Liability Tool was effective January 1, 2023. By January 1, 2024, this Tool must provide information on ALL “shoppable” medical items or services.
Contemporaneous with efforts to increase the transparency of medical prices and health claims for group health plan participants, the Trump Administration took steps to require all health care companies doing business in Medicare, Medicaid and selling individual market plans through the Federally facilitated ACA Exchange to share health claims data and other important information electronically with their policyholders/beneficiaries. These requirements were set forth in what are known as the “Interoperability Rules,” which were finalized in early 2020 and effective in 2021.
In addition, the Trump Administration developed and finalized the “Hospital Transparency Rule” in 2019. Effective as of January 1, 2021, these regulations require hospitals to disclose on a public website through MRFs a hospital’s gross charges, cash prices for self-pay patients, in-network negotiated rates with specific insurance carriers and self-insured plans, and the minimum and maximum negotiate rates with these payers.
Torch Passed to the Biden Administration
Although partisan politics often dominates policymaking in Washington, DC, the Biden Administration is faithfully implementing the Hospital Transparency Rule, Interoperability Rule and the TiC Rule. This makes sense because transparency is an issue that shares bipartisan support. After all, the Trump Administration built upon the ACA’s transparency provision, and then further expanded what, when and how medical prices and health claims must be disclosed to the public.
And now, the Biden Administration is taking-up-the-mantle and enforcing compliance with all these transparency Rules, while also providing technical guidance to insurance carriers, self-insured plans and their service providers as these stakeholders continue to comply with these public disclosure requirements.
Not to Be Outdone, Congress Gets Going on Transparency, Too
Throughout 2018 and 2019, Congress worked on similar and complimentary transparency requirements for insurance carriers and self-insured health plans, culminating in the enactment of the No Surprises Act as part of the Consolidated Appropriations Act on December 27, 2020. This new legislation includes several transparency-related provisions including:
- A Price Comparison Tool. Similar to the regulatory Cost-Sharing Liability Tool, insurance carriers and self-insured plans must allow plan-holders – through telephone and through an online website – to compare the amount of cost-sharing they would be responsible for paying for a particular medical item or service. It is likely that the Federal Departments will confirm in guidance that compliance with the Cost-Sharing Liability Tool will serve as compliance with this Price Comparison Tool requirement. Guidance, however, has yet to be released.
- The Advanced Explanation of Benefits (AEOB). Requiring insurance carriers and self-insured plans to send pricing and out-of-pocket payment information to a plan-holder in advance of a “scheduled” medical procedure or service. To date, no Federal guidance has been issued implementing the AEOB requirement.
- Updating and Improving Provider Directories. Requiring an insurance carrier and a self-insured plan to update – every 90 days – the carrier’s/plan’s provider directory by removing providers that are no longer in-network and adding those providers that become in-network providers through a new network agreement. The up-to-date provider directory must also be in the form of a database that is posted on a public website. Similar to the AEOB requirement, implementing guidance has yet to be issued.
Gag Clause Prohibition. Prohibiting the addition of a contractual “gag clause” in agreements between a group health plan and the owner of a provider network or a Third-Party Administrator (TPA) that prevents the plan and its plan sponsor from accessing the plan’s pricing information and health claims-related data. On February 23, 2023, the Federal Departments released guidance confirming that this prohibition was effective as of December 27, 2020, and the guidance also explains the process through which plans must submit to the Federal Departments an “attestation” that the plan is complying with this provision of the law. Although the Gag Clause Prohibition has been effective for over two years now, plans and their plan sponsors are STILL having difficulty accessing the plan’s pricing and claims data (as discussed more fully in the following blog post).
Don't miss Part 2 of this blog series.
The information provided does not, and is not intended to, constitute legal advice; instead, all information and content herein is provided for general informational purposes only and may not constitute the most up-to-date legal or other information.