Oct 29, 2020
·
Policy
·
Quality
The Transparency in
Coverage final rule released today by the Department of Health and Human
Services (HHS), the Department of
Labor, and the Department of the Treasury (the Departments) delivers on
President Trump’s executive order on Improving Price and Quality Transparency
in American Healthcare to Put Patients First.[1]
This final rule is a historic step toward putting health care price information
in the hands of consumers and other stakeholders, advancing the
Administration’s goal to ensure consumers are empowered with the critical
information they need to make informed health care decisions.
The requirements in this
rule will give consumers the tools needed to access pricing information through
their health plans. This rule builds upon previous actions the Administration
has taken to increase price transparency by giving patients access to hospital
pricing information. The Administration has already finalized requirements for
hospitals to disclose their standard charges, including negotiated rates with
third-party payers. The requirements in the Transparency in Coverage final rule
will reduce the secrecy behind health care pricing with the goal of bringing
greater competition to the private health care industry.
For too long, Americans have been in the dark about the cost of
their health care until after they obtain services and receive a bill. This
rule will require most group health plans, and health insurance issuers in the
group and individual market to disclose price and cost-sharing information to
participants, beneficiaries, and enrollees. The Departments are finalizing a
requirement to give consumers real-time, personalized access to cost-sharing
information, including an estimate of their cost-sharing liability, through an
internet based self-service tool. This requirement will empower consumers to
shop and compare costs between specific providers before receiving care.
Through this final rule, plans and issuers will also be required to disclose on
a public website their in-network negotiated rates, billed charges and allowed
amounts paid for out-of-network providers, and the negotiated rate and
historical net price for prescription drugs. Making this information available
to the public will drive innovation, support informed, price-conscious
decision-making, and promote competition in the health care industry.
Making Health Care Price
Information Accessible for Consumers
This final rule includes two approaches to make health care
price information accessible to consumers and other stakeholders, allowing for
easy comparison-shopping.
·
First, most
non-grandfathered group health plans[2] and
health insurance issuers offering non-grandfathered health insurance coverage
in the individual and group markets will be required to make available to
participants, beneficiaries and enrollees (or their authorized representative)
personalized out-of-pocket cost information, and the underlying negotiated
rates, for all covered health care items and services, including prescription
drugs, through an internet-based self-service tool and in paper form upon
request. For the first time, most consumers will be able to get real-time and
accurate estimates of their cost-sharing liability for health care items and
services from different providers in real time, allowing them to both
understand how costs for covered health care items and services are determined
by their plan, and also shop and compare health care costs before receiving
care. An initial list of 500 shoppable services as determined by the
Departments will be required to be available via the internet based
self-service tool for plan years that begin on or after January 1, 2023. The
remainder of all items and services will be required for these self-service
tools for plan years that begin on or after January 1, 2024.
·
Second, most
non-grandfathered group health plans or health insurance issuers offering
non-grandfathered health insurance coverage in the individual and group markets
will be required to make available to the public, including stakeholders such
as consumers, researchers, employers, and third-party developers, three
separate machine-readable files that include detailed pricing information. The
first file will show negotiated rates for all covered items and services
between the plan or issuer and in-network providers. The second file will show
both the historical payments to, and billed charges from, out-of-network
providers. Historical payments must have a minimum of twenty entries in order to
protect consumer privacy. And finally, the third file will detail the
in-network negotiated rates and historical net prices for all covered
prescription drugs by plan or issuer at the pharmacy location level. Plans and
issuers will display these data files in a standardized format and will provide
monthly updates. This data will provide opportunities for detailed research
studies, data analysis, and offer third party developers and innovators the
ability to create private sector solutions to help drive additional price
comparison and consumerism in the health care market. These files are required
to be made public for plan years that begin on or after January 1, 2022.
In this rule, HHS will also allow issuers that empower and
incentivize consumers through plans that include provisions encouraging
consumers to shop for services from lower-cost, higher-value providers, and
that share the resulting savings with consumers, to take credit for such
“shared savings” payments in their medical loss ratio (MLR) calculations. HHS
will allow this to ensure that issuers would not be required to pay MLR rebates
based on a plan design that would provide a benefit to consumers that is not
currently captured in any existing MLR revenue or expense category. HHS
believes this change will preserve the statutorily-required value that
consumers receive for coverage under the MLR program, while encouraging issuers
to offer new or different value-based plan designs that support competition and
consumer engagement in the healthcare market.
The final rule can be found here: https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/CMS-Transparency-in-Coverage-9915F.pdf
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[1] https://www.whitehouse.gov/presidential-actions/executive-order-improving-price-quality-transparency-american-healthcare-put-patients-first/
[2] Grandfathered
health plans are health plans that were in existence as of March 23, 2010, the
date of enactment of PPACA, and that are only subject to certain provisions of
PPACA, as long as they maintain status as grandfathered health plans under the
applicable rules. Under section 1251 of PPACA, section 2715A of the
PHS Act does not apply to grandfathered health plans. This rule
would not apply to grandfathered health plans (as defined in 26 CFR 54.9815-1251,
29 CFR 2590.715-1251, 45 CFR 147.140).
https://www.cms.gov/newsroom/fact-sheets/transparency-coverage-final-rule-fact-sheet-cms-9915-f
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