Health Care Cost Transparency | Prescription Drug Data Collection (RxDC) Reporting Update to Instructions for 2022 Reference Year Reporting Due June 1, 2023

Employee Benefits

Health Care Cost Transparency | Prescription Drug Data Collection (RxDC) Reporting Update to Instructions for 2022 Reference Year Reporting Due June 1, 2023

On March 28, 2023, the Centers for Medicare & Medicaid (CMS) updated its guidance and instructions on the No Surprises Act health plan transparency reporting for the 2022 reference year that is due on June 1, 2023. See the Prescription Drug Data Collection (RxDC) Reporting Instructions. The updated instructions address several questions that were previously unanswered with respect to RxDC reporting for the 2020 and 2021 reference years (reporting for these calendar years was originally due on 12/27/2022).

While the key reporting elements and entities remain relatively unchanged in the guidance, there were significant changes to some areas of the reporting instructions. Along with other material changes, the updated reporting instructions now provide further clarity for group health plans and/or their third party reporting entities with respect to the following key points:

  • Reporting entities need not report RxDC information related to retiree-only health plans (Section 1.4 of the instructions). The updated instructions; however, reaffirm that individual and group health plans (on and off the Exchange), including both grandfathered and non-grandfathered employer sponsored health plans that include active employees, student health plans and plans maintained under the FEHB for federal governmental employers, remain subject to the RxDC reporting requirements.
  • Plans, issuers and carriers in all U.S. states/districts, including the District of Columbia (DC) and the U.S. Territories1, are subject to the reporting requirements (Section 1.5).
  • Reporting entities now have more flexibility to create multiple submissions for the same reference year (Section 3.5) when the data are mutually exclusive (i.e., there is no “overlapping data” in the separate submissions).
  • For the 2022 reference year reporting, multiple vendors may submit the same type of data file on behalf of the health plan (Section 3.3). Examples are provided in the instructions for cases in which there is a change in vendor during the calendar year or when different vendors provide different services (such as when there are separate vendors for medical and behavioral health benefits). It also would allow the submission of multiple D1 files for the same plan (e.g., one by a TPA or carrier and one by the plan sponsor when the TPA/carrier is unwilling to submit all D1 data). However, where possible, CMS encourages aggregation of the data into one submission.
  • The suspension of data aggregation restrictions, which applied to the 2020/2021 reference year reporting, has been extended and now applies to the 2022 reference year reporting. Without the extension, under the Interim Final Rules2, coordination between vendors reporting on behalf of the health plan or issuer would be required (Section 5.6).

1 U.S. Territories include the U.S. Virgin Islands, Northern Mariana Islands, Guam, American Samoa and Puerto Rico.

2 Under 26 CFR 54.9825-5T(b)(2)(i), 29 CFR 2590.725-3(b)(2)(i), and 45 CFR 149.730(b)(2)(i), the data submitted in files D1 and D3 – D8 must not be aggregated at a less granular level than the aggregation level used by the reporting entity that submitted the data in file D2 (Spending by Category).

3 See RxDC Reporting Instructions for identification of cost reporting information in data elements D1-D8.

4 P1 – individual and student market plan list, P2 – group health plan list, P3 – Federal Employee Health Benefit (FEHB) Plan. Each RxDC submission must include one of these Plan List files.

Regulatory and Legislative Strategy Group