Starting July 1, 2022, employers that maintain group health plans (plans) and health insurance issuers (issuers) will be required to disclose pricing information on a public website in the form of three machine-readable files (MRFs). This requirement is one of the Transparency in Coverage Final Rules (the Rules) released by the Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Department of the Treasury (collectively, the Departments) in November 2020.

Under the Rules, the three MRFs must disclose:

  1. In-Network Rates – the in-network provider negotiated rate for all covered items and services.
  2. Out-of-Network Amounts – the historical out-of-network allowed amounts for covered items and services.
  3. Prescription Drug Costs – the negotiated rates and historical pricing information for covered prescription drugs.

The Departments will begin enforcing the disclosure requirements regarding the first two MRFs for in-network rates and out-of-network amounts on July 1, 2022. Enforcement for disclosure regarding covered prescription drugs has been delayed indefinitely.

Access to Machine Readable Files

A machine-readable file, or MRF, is a digital representation of data or information in a file that can be imported or read by a computer system for further processing without human intervention while ensuring no semantic meaning is lost.  The Rules specify that the MRFs must be in a non-propriety open format (for example, JavaScript Object Notation (JSON), Extensible Markup Language (XML), or Comma Separate Value(s) (CSV)). A PDF, due to its proprietary nature, would not be sufficient.

The MRFs must be publicly available on an internet website; accessible free of charge, without establishing a user account, password, or other credentials; and available without having to submit any personal identifying information. Note that an internal intranet site or benefits portal would not meet these requirements. The Rules are somewhat vague as to the accessibility standards and specific location for posting the MRFs, but the preamble to the Rules states that the Departments have opted to allow plans flexibility to publish the MRFs in the locations of their choosing based on their superior knowledge of their website traffic and the places on their website where the MRFs would be readily accessible by the intended users.

Next Steps for Plan Sponsors

The Rules expect and allow for plans to enter into a written agreement with their insurance carriers (for insured plans) or third-party administrators (TPAs) (for self-insured plans) to make the required MRFs publicly available. We recommend that plan sponsors reach out to their insurance carriers or TPAs, as applicable, to confirm the specific steps the carriers or TPAs are taking to ensure the MRFs will be available for public disclosure by July 1, 2022. Because the enforcement deadline is rapidly approaching, we encourage plan sponsors to take action sooner rather than later.

The Rules are silent as to penalties for non-compliance, and as of the date of this publication, we are unaware of any guidance that addresses the topic. However, we are continuing to monitor developments concerning the Rules and their enforcement. If you have any questions about the Transparency in Coverage Final Rules or need assistance reaching out to your insurance carrier or TPA, please contact a member of our Employee Benefits Practice.