Proposal to disclose cost-sharing information to plan participants

Under the proposed rule, non-grandfathered group health plans and health insurers would have to provide upon request to a participant or beneficiary, or their authorized representative, certain information that would enable them to better understand their health care costs before obtaining treatment. The information would be similar to what is provided in an Explanation of Benefits (EOB) form, but would be provided before services are rendered instead of after. A notice that is required to be provided at the same time as the cost-sharing information would include information about balance billing, as well as disclaimers that the information provided does not mean that benefits are guaranteed. The Departments have published a proposed model notice.

The proposal would require provision of detailed information, including the following:

• Current cost-sharing information, including an estimate of the participant’s cost-sharing liability for a requested covered item or service calculated based on their accumulated amounts for deductibles or out-of-pocket limits;
• The negotiated rate, in dollars, for an in-network provider for the requested covered item or service; and
• The out-of-network allowed amount for the requested covered item or service, if the request is for out-of-network services.

In addition, coverage prerequisites must be disclosed, including prior authorization, step-therapy or fail-first protocols, or concurrent review. Prerequisites do not include general medical necessity or medical management techniques.

Plan sponsors would be required to provide the information at no cost to the participant through a self-service tool on a website that provides real-time responses based on cost-sharing information that is accurate at the time of the request. If requested by the participant, the information would have to be mailed in paper form within two business days.

Plans with insurers or third-party administrators could allocate responsibility for compliance, in accordance with rules set forth in the proposal. Self-insured plans, however, would retain liability for compliance. The proposal would not apply to excepted benefits (such as separate dental or vision plans), short-term limited duration insurance health reimbursement arrangements or other account-based plans. The rule would be applicable one year after publication of a final rule, although the Departments seek comment on the timing and resources necessary to come into compliance.

Proposal to require disclosure of provider rates

The proposed rule would require health plans and insurers to publish their negotiated rates and allowable out-of-network charges on a website, updated monthly through two machine-readable files. This information would have to be publicly available, accessible without charge, and could not require a user account, password or other credentials, or submission of personally identifiable information to be accessible. The Departments have published data fields for both types of disclosures.

Enforcement

Plans would be subject to enforcement mechanisms and civil monetary penalties applicable to group health plans under ERISA and the Public Health Service Act. A group health plan would not fail to comply with the section solely because it makes an error or omission, or because an Internet website is temporarily inaccessible, as long as it is acting in good faith and with reasonable diligence.

Proposal to require disclosure of provider rates

Plan sponsors with non-grandfathered health plans may wish to consider commenting on the proposed regulation no later than 5 pm on January 14, 2020.

Some plans may already have websites with robust cost-sharing information. However, others may rely on telephone contact for this information, and all plans are likely to need to improve processes for tracking both negotiated rates and out-of-network allowable charges. In addition, plans may wish to comment on the time it would take to come into compliance, potential contract changes that would be necessary and administrative expenses. Finally, with respect to disclosure of rates, it may be difficult for plan sponsors to access negotiated rates and out-of-network payment amounts on a monthly basis and post them online for several reasons, including contract limitations and technical ability.

Segal can assist plan sponsors to understand the new proposal, discuss implications with plan service providers and prepare comments to the Departments.