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Jan 31 -- The Centers for Medicare & Medicaid Services, Health and Human Services (HHS), invites comments by April 1, 2024 on CMS-10788 -- Prescription Drug and Health Care Spending.

Title I (No Surprises Act) and Title II (Transparency) of Division BB of the Consolidated Appropriations Act, 2021 (Pub. L. 116-260) (CAA), establish new protections for consumers related to surprise billing and transparency in health care. The Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Department of the Treasury (Treasury) (collectively, the Departments), are responsible for implementation and, along with State regulatory entities, enforcement of these new requirements. These information collection requirements concern the Departments’ collection of data related to prescription drug and health care spending required under section 204 of Title II (Transparency) of Division BB of the CAA.

Title II of Division BB was enacted as part of the CAA to promote transparency in health care costs and, particularly, prescription drug costs. Section 204 of the Transparency Title amended the Public Health Service Act (PHS Act), the Employee Retirement Income Security Act of 1974 (ERISA), and the Internal Revenue Code (the Code) by adding new sections that, among other things, authorize the collection of prescription drug and health care spending data from group health plans and health insurance issuers on an annual basis (section 204 data submission). The CAA also requires the Departments to prepare a publicly-available report on prescription drug cost trends. The interim final rules entitled Prescription Drug and Health Care Spending” (henceforth the 2021 interim final rules) issued by the Departments and the Office of Personnel Management (OPM) specify requirements for group health plans, health insurance issuers, and Federal Employees Health Benefits (FEHB) carriers to submit information regarding prescription drug and health care spending.

Section 9825 of the Code, section 725 of ERISA, and section 2799A-10 of the PHS Act require group health plans and health insurance issuers to submit certain information to the Departments about their plan or coverage, including 50 most frequently dispensed brand prescription drugs, the 50 most costly prescription drugs by total annual spending, and the 50 prescription drugs with the greatest increase in plan or coverage expenditures from the preceding plan year.

Section 9825 of the Code, section 725 of ERISA, and section 2799A-10 of the PHS Act also require plans and issuers to report total spending on health care services by the plan or coverage broken down by the type of costs (including hospital costs; health care provider and clinical service costs, for primary care and specialty care separately; costs for prescription drugs; and other medical costs, including costs for wellness services); spending on prescription drugs by the plan or coverage as well as by participants, beneficiaries, and enrollees, as applicable; and the average monthly premiums paid by participants, beneficiaries, and enrollees and paid by employers on behalf of participants, beneficiaries, and enrollees, as applicable. Plans and issuers must report rebates, fees, and any other remuneration paid by drug manufacturers to the plan or coverage or its administrators or service providers, including the amount paid with respect to each therapeutic class of drugs and for each of the 25 drugs that yielded the highest amount of rebates and other remuneration under the plan or coverage.

Section 9825 of the Code, section 725 of ERISA, and section 2799A-10 of the PHS Act further require plans and issuers to report any reduction in premiums and out-of-pocket costs associated with prescription drug rebates, fees, or other remuneration. Under section 9825 of the Code, section 725 of ERISA, and section 2799A-10 of the PHS Act, plans and issuers must report data by June 1 of each year. Pursuant to 5 U.S.C. 8910 and OPM instruction found in FEHB Carrier Letter 2022-12, FEHB carriers must also report data by June 1 of each year.  

Section 9825 of the Code, section 725 of ERISA, and section 2799A-10 of the PHS Act additionally require the Departments to publish on the internet a report (Section 204 public report) on prescription drug reimbursements for plans and coverage, prescription drug pricing trends, and the role of prescription drug costs in contributing to premium increases or decreases under the plans or coverage, with information that is aggregated so that no drug or plan specific information is made public. This Section 204 public report must be published no later than 18 months after the date on which plans and issuers are required to first submit the information and biannually thereafter.

This ICR is being revised for 2023 and later reference years to add clarifications in response to questions received from the respondents.

CMS-10788 draft data collection instruments and technical documentation: https://www.cms.gov/https/wwwcmsgov/regulations-and-guidance/legislation/paperworkreductionactof1995/pra-listing/cms-10788
FRN: https://www.federalregister.gov/d/2024-01831

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