The Biden administration is proposing sweeping new reporting requirements for employers and health insurers in a bid to collect more information on prescription drug pricing and its impacts on consumer healthcare costs. The interim final rule from HHS, the Office of Personnel Management and the labor and treasury departments requires health insurance issuers, employer-based health plans and other group health plans to disclose detailed information about drug costs and coverage to the federal government, including the average monthly premiums and drug spending for patients, compared to their employers or plan issuers. The goal is to eventually publish a report on prescription drug pricing trends and rebates, as well as their impact on premiums and out-of-pocket costs. The rule is the fourth in a series of regulations implementing surprise billing protections and transparency measures for consumers passed by Congress as part of its federal spending package last year.
More on Rule
Under the rulemaking, data reporting requirements are to be submitted to the Departments and OPM. Specifically, submissions must include: (1) plan and coverage information; (2) impacts of prescription drug rebates, fees, and other remuneration on premiums and out-of-pocket costs; (3) enrollment and premium information; (4) total health care spending categorized by type and cost; and (5) rebates, fees, and other remuneration paid by drug manufacturers for specified drugs.
Additionally, plans, issuers, and FEHB carriers are required to submit to their respective entities an annual overview of their top 50 drugs across several areas, including the: (1) most frequently dispensed brand prescription drugs; (2) costliest prescription drugs; (3) and prescription drugs with the greatest increase in total plan expenditures over the previous year.
As per the rule, the Departments will use this data to synthesize biannual reports on prescription drug pricing trends and rebates, as well as ripple effects on health insurance premiums and out-of-pocket spending. HHS intends for the new requirements and reports to enhance transparency efforts. The rule stipulates that — rather than submitting this information separately for each plan — plans, issuers, and FEHB carriers will be required to submit the specified information aggregated at their respective state or market level.
Plans and issuers are required to submit the information specified in the rule to the Departments by December 27, 2021. In calendar year 2022 and beyond, plans and issuers must submit this information by June 1. However, the Departments are delaying enforcement of the December 27, 2021, and June 1, 2022, deadlines in order to offer regulated entities the time needed to comply with the requirements. Plans, issuers, and FEHB carriers that submit the required information for 2020 and 2021 by December 27, 2022, will not be subject to enforcement actions by the Departments or OPM.