Departments Issue New Rule Requiring Group Health Plans to Disclose Health Care Cost Information

The Departments of Health and Human Services, Labor, and Treasury (“the Departments”) have issued the final rule on health care coverage transparency, imposing important new requirements on non-grandfathered health plans and self-insured plans to disclose health care cost and cost-sharing information.

Group Health Plan Transparency Requirements

For plan years beginning on or after January 1, 2022, plans must make the following information available to the public via a machine-readable file and update it every month:

  • In-network negotiated rates between the plan and its providers for covered services and items;
  • Out-of-network allowable charges and billed amounts for the most recent 90-day period; and
  • Negotiated rates for In-network prescription drugs and historical net prices for all prescription drugs covered by the plan at the pharmacy location level.

For plan years beginning on or after January 1, 2023, plans must make the following information on an initial list of 500 plan services (to be determined by the Departments) available to plan participants via an Internet-based, self-service tool or in writing by request:

  • In-network and out-of-network negotiated rates for all covered health care services and items, including prescription drugs;
  • Estimated cost-sharing amount for the insured;
  • How much the insured has paid to date toward the plan’s deductible or out-of-pocket maximum;
  • If the service or item requested is part of a bundled payment, a list of items or services included in the bundle for which cost-sharing information is available; and
  • A notice if there are any requirements prior to obtaining coverage.

For plan years beginning on or after January 1, 2024, plans must make the self-service online tool available for all covered services.

Medical loss ratio (MLR) reporting for 2020: Health insurance issuers with plans that encourage plan participants to shop for and receive care from lower-cost, higher-value providers are permitted to receive credit in their MLR calculations for savings they share with participants. When the MLR falls below certain thresholds – generally 80% in the individual and small group markets and 85% in the large group market – insurers are required to pay rebates to groups under the MLR rules. These rebates may be provided in the form of a premium credit, a reduction in cost sharing, or a gift card issued to the insured. 

The experienced, responsive team of ERISA attorneys at Hall Benefits Law helps plan administrators understand what regulations and rulings are relevant and how best to apply these rulings in practice. Learn more by calling 678-439-6236.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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