The Centers for Medicare and Medicaid Services (CMS) announced last week that it would begin enforcing the Transparency in Coverage (TiC) requirement that plans post prescription drug information in a machine readable file (MRF) and display it on a barrier-free, publicly available website. CMS had previously deferred enforcement. You can read the agency’s in-depth FAQs here.
As a reminder, the TiC final rule includes three MRF requirements:
- An allowed amount file: allowed amounts for, and billed charges from, out-of-network providers.
- In-network rate file: rates for all covered items and services between the plan or issuer and in-network providers.
- Prescription drug file: negotiated rates and historical net prices for covered drugs.
While the new guidance requires that health plans publish the prescription drug MRF, CMS also stated that it intends to develop technical requirements and an implementation timeline for doing so in future guidance. In summary, CMS has not said when it expects health plans to make their prescription drug MRFs available, nor has the agency described the form and manner in which plans should do so.
CMS has also rescinded the April 2022 enforcement safe harbor around the requirement that plans disclose certain rates as dollar amounts in their MRFs and clarified:
Whether a plan/issuer is able to comply with the requirement to disclose certain rates as dollar amounts is a fact-specific determination; therefore, CMS intends to exercise enforcement discretion with respect to this requirement on a case-by-case basis, without any categorical “safe harbor.”
In other words, CMS is unlikely to pursue enforcement action against a health plan if the plan can demonstrate that compliance with provisions of TiC regarding disclosure of certain rates as dollar amounts would have been extremely difficult or impossible.
So what does this mean for you?
In general, the new guidance infers that CMS wants health plans to start moving forward with developing their prescription drug MRFs, even though the agency has given no timeline for doing so. Further, the guidance says that, if a plan cannot disclose certain rates as dollar amounts in their MRFs, then the plan should be able to demonstrate that it is extremely difficult or impossible to do so.
CMS’ posture of heightened enforcement on both these issues will add to health plans’ existing regulatory burdens. To date, CMS has not enforced any of the TiC requirements. However, the agency appears to be signaling that it soon will.