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What Are Prescription Drug and Health Care Spending Reports and When Are They Due?



QUESTION: We’ve heard there is a requirement to report prescription drug and health care spending to the government in 2022. What are the reporting requirements and when are the reports due?

ANSWER: Year-end legislation passed in 2020 requires group health plans and insurers to annually report prescription drug and health care spending, premiums, and enrollment information to the government (see our Checkpoint article). In addition to general identifying information such as the beginning and end dates of the plan year, the number of enrollees covered, and each state in which the plan is offered, a broad range of health care spending information must be reported (see our Checkpoint article). For example, the average monthly premium paid by employees versus employers must be reported, as well as the total health care spending broken down by type (such as hospital care, primary care, and specialty care) and prescription drug spending by enrollees versus plans and insurers. Plans and insurers must also report the 50 most frequently dispensed brand prescription drugs, the 50 costliest prescription drugs by total annual spending, and the 50 prescription drugs with the greatest increase in plan or coverage expenditures from the previous year.

Information must be submitted based on the “reference year,” which the agencies have defined as the calendar year immediately preceding the calendar year in which the data submission is due. Calendar year 2020 information was initially required to be submitted by December 27, 2021; calendar year 2021 information by June 1, 2022; calendar year 2022 information by June 1, 2023; and so on. However, the agencies have advised that they will not initiate enforcement actions against plans or insurers that submit the required data for the 2020 and 2021 reference years by December 27, 2022. The agencies have indicated that the data is to be submitted through the RxDC module in the Health Insurance Oversight System (HIOS) (see our Checkpoint article).

For more information, see EBIA’s Health Care Reform manual at Section XXXVI.L (“Prescription Drug and Health Care Spending Reporting”). See also EBIA’s Self-Insured Health Plans manual at Section XXIX.D.4 (“Prescription Drug and Health Care Spending”) and EBIA’s ERISA manual at Section XXI.C (“Caution Regarding Additional Obligations”).

Contributing Editors: EBIA Staff.

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