On September 27, 2023, the Departments of Treasury, Labor, and Health and Human Services (Departments) issued FAQs revoking their non-enforcement policies with respect to two requirements included in the transparency in coverage (TIC) final rules.

Background

• The TIC final rules applied to non-grandfathered health plans with plan years starting on or after July 1, 2022. They required covered plans to post, and update monthly, three machine-readable files (MRFs) containing the following data:
  • In-network rates for covered items and services, with rates expressed as dollar amounts
  • Out-of-network allowed amounts
  • Prescription drug negotiated rates and historical net prices
• On August 20, 2021, enforcement of the prescription drug MRF requirement was delayed to allow time for the Departments to evaluate potential overlap with the prescription drug reporting requirement included in the 2021 Consolidated Appropriations Act.
• On April 19, 2022, the Departments released an FAQ that established an enforcement safe harbor with respect to the TIC rules’ requirement that in-network rates be expressed as dollar amounts where reimbursement arrangements are calculated by other means (e.g., as a percent of billed charges).

Prescription Drug Machine-Readable File

• The September 27 FAQs indicate that delayed enforcement of the machine-readable file requirement has been rescinded, as the Departments have determined that the requirement in the TIC rules is sufficiently different from the CAA requirements. The previous categorical deferral will be replaced by enforcement on a case-by-case basis.
• The Departments do not plan to engage in rulemaking on this requirement, but future technical guidance, including an implementation timeline, will be released in the coming months. The Departments have suggested that the timeline will allow some degree of lead time for plans to transition from the previous deferred enforcement policy.

In-Network Rate Machine-Readable File

• The FAQ reiterates that enforcement discretion with respect to the reporting of negotiated rates as dollar amounts will be exercised on a case-by-case basis. This means that if plans are currently using reimbursement arrangements based on percentages of billed charges, they will need to determine what changes they may need to make in order to comply with the requirement to report in-network rates as dollar amounts.
• The Tri-Agencies clarified that they never intended to provide a blanket enforcement safe harbor; rather, it was always their intent to enforce this provision on a case-by-case basis. The Tri-Agency announcement did not include any guidelines for implementation and did not mention future guidance.

Plan Sponsor Takeaways

• Pending the forthcoming implementation timeline for the prescription drug MRF requirement, plan sponsors should check with their carriers or TPAs to determine each vendor’s approach to compliance.
• Plan sponsors with compensation arrangements that do not rely on predetermined dollar amounts should take action with their carriers/TPAs to determine whether changes are needed in response to the rescission of the safe harbor.