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June 6, 2022
Under the “Transparency in Coverage” Final Rule (TiC), issued in 2020 by the U.S. Department of Health & Human Services, U.S. Department of Labor, and U.S. Department of the Treasury (collectively the Departments), effective 7/1/22, health plans (which include employers who sponsor employee benefit plans) and health insurance issuers must publicly post pricing data known as the “machine-readable files” or (“MRFs”). The point of the release of these cost data files has nothing to do with communication to employees or plan participants, but instead, in the name of health cost transparency, this rule requires insurance companies and self-insured plans to publicize what they pay providers for medical services and make that available to the public. One of the primary goals with this requirement is that the information can then be gathered broadly, and data analytics run to provide more transparency across the industry.
Fully-insured plans may generally rely on the insurance carrier to handle this requirement on behalf of the plan. However, for employers offering self-insured plans, the employer may be required to post a link to such file on the employer’s public website.
Carriers and TPAs have begun to issue communications outlining how they plan to meet these requirements. One of the requirements of particular interest to employers is that the data must be made available on a publicly available website. Carriers and TPAs have interpreted this requirement differently, creating some confusion among employers. The TiC rules require the group health plan to post links to the machine-readable files containing the TiC pricing information on a publicly available website.
The machine-readable files must be accessible free of charge, without having to establish a user account, password, or other credentials, and without having to submit any personal identifying information such as a name or email address. Treas. Reg. §54.9815-2715A3(b)(2.).
Based on the information currently available, we are recommending that employers be prepared to do the following:
NOTE: We are hopeful that there may be additional guidance coming from the Departments that would allow a TPA to satisfy the posting requirements on behalf of the health plans they administer, in which case employers offering self-insured coverage would not have to post anything on their company websites.
Creating, hosting, and linking to the machine-readable files is just one part of the overall requirements. The machine-readable files must be updated monthly (and clearly indicate the date the filed was last updated), must be available in a form and manner specified in any guidance issued by the IRS, DOL, or CMS.
Employers should work with their brokers & consultants to confirm with their carriers and TPAs that they are able to meet the requirements and to understand the approach their carriers and TPAs are taking.
The views and opinions expressed within are those of the author(s) and do not necessarily reflect the official policy or position of Parker, Smith & Feek. While every effort has been taken in compiling this information to ensure that its contents are totally accurate, neither the publisher nor the author can accept liability for any inaccuracies or changed circumstances of any information herein or for the consequences of any reliance placed upon it.