Given this heightened focus on healthcare transparency, sponsors of group health plans should be sure their plans comply with existing transparency requirements. New enforcement actions against health and hospitals are likely.

Background

In 2020, the Departments of Labor, Health and Human Services, and the Treasury (collectively, the Departments) issued a final health plan Transparency in Coverage (TIC) rule that implemented requirements established under the ACA. The rule required plans to post machine-readable files containing price information on their public websites and provide a self-service price comparison tool for use by plan participants.

Machine-readable files

Since 2022, non-grandfathered health plans and insurers have been required to publish their negotiated rates and allowable out-of-network charges on a public website, updated monthly through machine-readable files. The files show negotiated rates for in-network services as well as historical payments to and billed charges from out-of-network providers.

A requirement to publish historical net prices for covered prescription drugs was initially postponed and recently reinstated, although the Departments have not yet published data requirements for prescription drug reporting.

Self-service price comparison tool

Since 2023, non-grandfathered health plans and insurers have been required to make an internet-based self-service tool available to participants, beneficiaries and enrollees that discloses the price and cost-sharing liability for covered items and services, including prescription drugs.

For plan years beginning on or after January 1, 2023, price comparison information was required for 500 items and services. For plan years beginning on or after January 1, 2024, price comparison information must be available for all covered items and services.

Similar to the rules for health plans, hospitals are also required to provide patients with consumer-friendly pricing information for up to 300 shoppable services and a machine-readable file with negotiated rates for all provided services.

Reviews of these transparency requirements are mixed

The machine-readable files are not accessible to plan participants but are available to health policy researchers and consultants that have access to large data storage systems for health cost research. However, some plan sponsors believe that disclosure of price information can impede price negotiation.

Few plan participants appear to use the internet-based self-service price tools, which may have limited usefulness for searches related to provider cost information.

The executive order

The executive order states that progress on healthcare price transparency at the federal level has stalled since the end of President Trump’s first term. To ensure that patients have the information they need to make well-informed decisions about their healthcare, the executive order directs the Departments to take the following actions by May 26, 2025:

• Require the disclosure of actual prices of items and services, not estimates.
• Issue updated guidance or proposed regulations to ensure pricing information is standardized and easily comparable.
• Issue guidance or proposed regulations updating enforcement policies designed to ensure compliance with the transparent reporting of complete, accurate and meaningful data.

Impact on plan sponsors

As noted above, it is likely that the Departments will review existing regulations and enforcement actions against both health plans and hospitals. To implement the executive order, the Departments could revise existing regulations or sub-regulatory guidance concerning how machine-readable files and consumer-friendly price information is required to be created. It could also create renewed enforcement efforts, including audits, and, for hospitals, warnings and civil monetary penalties.

Additionally, the Departments may issue new data guidelines for prescription drug machine-readable files, which have never been fully implemented.

Plan sponsors should ensure that they are providing machine-readable files and self-service internet-based pricing tools, either directly or through their plan service providers. If a third-party service provider is hosting the machine-readable files or price tools, plan sponsors should obtain contractual guarantees that the services meet applicable federal guidelines.

It’s also important for plan sponsors to look out for any new requirements published by the Departments.

If you’re on our mailing list, we’ll keep you informed.