Health Insurers Face Urgent New Federal Drug Price Reporting Deadline

Health insurers and benefit plan administrators will have to scramble to begin feeding data into a big new prescription drug price transparency program.

The first prescription spending reports will be due Dec. 27, 2022, officials from four federal agencies announced Wednesday.

The agencies — the Department of Health and Human Services, the Labor Department, the Treasury Department and the Office of Personnel Management — have teamed up to launch the reporting program, which was created by a health care transparency section in the Consolidated Appropriations Act, 2021 (CAA).

For financial professionals, the start of the reporting program means that any entity affected is likely to need new drug transparency tracking software and help with getting and understanding data.

Federal regulators are supposed to use the new data to create detailed analyses of prescription drug pricing. The effort could eventually help reduce the cost of prescription drugs.

The drug price transparency reports could create detailed streams of copyright-free data that financial professionals can use in their own articles, webinar slidedecks, social media posts and other materials.

Reporting Details

Federal regulators put out a request for ideas about how to implement the drug price reporting program in June.

The reports are supposed to include:

• General size and location information for each plan or coverage the payer offers.
• Information about how much the plan spends on hospitalization services, wellness programs and other items.
• A list of the payer’s 50 most frequently dispensed brand-name prescription drugs.
• The total number of paid claims for each of those 50 drugs.
• The 50 most costly prescription drugs by total annual spending.
• The amount the payer expects to spend each year on the 50 most costly drugs.
• The 50 drugs with the great increase in plan spending, when compared with spending for the previous year.

Officials say they want pharmacy benefit managers or third-party administrators to aggregate employer plan data and report for employer plans as much as possible, to create more useful streams of data and to reduce burdens on employers and the federal offices responsible for taking in the data.

The reporting rules apply to the “grandfathered health plans” that are exempt from many Affordable Care Act requirements.

The reporting rules do not apply to short-term health insurance policies, dental plans, programs based on health reimbursement arrangements, or other “excepted benefits” that fall outside the scope of most federal major medical insurance rules.

Implementation

Regulators are implementing the CAA reporting law with interim final regulations that include a request for comments.

The regulations are set to appear in the Federal Register, an official government publication, on Nov. 23.

Comments on the regulations will be due 60 days after the official Federal Register publication date.