The Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Internal Revenue Service (IRS) (collectively, "the agencies") have proposed regulations that would establish "price transparency requirements" for group health plans (with some important exceptions) and for health insurance issuers. This alert will discuss the proposed requirements applicable to group health plans. OVERVIEW The proposal would require that a group health plan timely disclose information about costs related to covered items and services to participants and beneficiaries and to the public. The detailed information required to be disclosed includes the negotiated amount for each in-network provider for a particular covered item or service and the allowed amount for out-of-network providers. The agencies believe that the disclosure of the required information "will equip consumers with information to actively and effectively participate in the health care system, the prices for which should be driven and controlled by market forces." Exceptions: The proposed rules do not apply to grandfathered health plans. Also, the proposed rules do not apply to health reimbursement arrangements (HRAs) or other account-based group health plans.¹ COMMENTS Plan sponsors may want to submit comments to the agencies. All comments are open to public inspection, and will be posted to the website shown below. Comment Due Date: January 29, 2020 Comments should be sent:

1. Electronically. Send to 'http://www.regulations.gov. Follow the "Submit a comment" instructions.
2. By regular mail. Mail written comments to the following address only.
   Centers for Medicare & Medicaid Services
   Department of Health and Human Services
   Attention: CMS-9915-P
   P.O. Box 8010
   Baltimore, MD 21244-8010
3. By express or overnight mail. Send written comments to the following address only.
   Centers for Medicare & Medicaid Services
   Department of Health and Human Services
   Attention: CMS-9915-P
   Mail Stop C4-26-05
   7500 Security Boulevard
   Baltimore, MD 21244-1850

PROPOSED DISCLOSURE REQUIREMENTS For group health plans, there are two separate disclosure requirements. The first is to a participant or beneficiary. The second is to the public. The proposed rules set out the information to be provided, and the method and format of the disclosure. Disclosure to Participants Information to Be Provided At the request of a participant, beneficiary, or their authorized representative, a group health plan or health insurance issuer must provide relevant cost-sharing information, as of the time the request is made, with respect to a covered item or service and a particular provider or providers. The information that must be provided is:

1. An estimate of the participant's or beneficiary's cost-sharing liability for a requested covered item or service provided by a provider or providers calculated based upon
   1. Accumulated amounts the participant has incurred to date;
   2. The negotiated rate, as a dollar amount, for an in-network provider or providers for the requested covered item or service; and
   3. The out-of-network allowed amount for the requested covered item or service furnished by an out-of-network provider;
2. If the covered item or service is subject to a bundled payment arrangement that includes the provision of multiple covered items and services, a list of the items or services for which cost-sharing information is disclosed;
3. If applicable, notification that coverage of a specific item or service is subject to a prerequisite (such as prior authorization or step-therapy); and
4. A notice that includes the following information in plain language:
   1. A statement that out-of-network providers may bill participants or beneficiaries for the difference (balance billing) between the provider's billed charges and the sum of the amount paid by the plan or insurer and the amount paid by the patient in copayments or coinsurance, and that the cost-sharing information being provided does not account for the potential additional amounts;
   2. A statement that the actual charges for the covered item or service may be different from an estimate provided pursuant to the request depending on the actual items or services the participant receives;
   3. A statement that the estimate for a covered item or service is not a guarantee that benefits will be provided for that item or service;
   4. Any additional information, including other disclaimers, that the plan or insurer determines is appropriate, provided that the information does not conflict with the information required to be provided.

Cheiron Observation: The agencies regard this information as analogous to providing an explanation of benefits (EOB) prior to the service and believe that it would useful to the participants and beneficiaries, particularly if information is requested for multiple providers. The effectiveness of the estimates depends on up-to-date information as to the participant's accumulated out-of-pocket amounts, what providers are in-network, the allowed amounts, and up-to-date resolution of prior claims. It will be difficult to avoid inaccuracies, which are likely to lead to confusion and complaints from both participants and providers.

Method and Format Required The disclosure to participants and beneficiaries must be available under two methods: 1) an internet-based self-service tool and 2) a paper form. Both methods must be available to participants and beneficiaries, and must be in "plain language." The self-service tool must be available without a subscription or other fee and allow users to:

1. Search for cost-sharing information for a covered item or service provided by a specific in-network provider or all in-network providers by inputting:
   1. A billing code (e.g., CPT code 87804) or a descriptive term (e.g., "rapid flu test"), at the option of the user;
   2. The name of the in-network provider, if the user seeks cost-sharing information with respect to a specific in-network provider; and
   3. Other factors utilized by the plan or issuer that are relevant for determining the applicable cost-sharing information (such as location of service, facility name, or dosage)
2. Search for an out-of-network allowed amount for a covered item or service provided by out-of-network providers by inputting:
   1. A billing code or descriptive term; and
   2. Other factors utilized by the plan or issuer that are relevant for determining the applicable out-of-network allowed amount (such as location of service, facility name, or dosage)
3. Refine and reorder search results based on geographic proximity of providers, and the amount of the participant's or beneficiary's estimated cost-sharing liability for the covered item or service, to the extent the search for cost-sharing information for covered items or services returns multiple results.

The paper method must be made available without fee at the request of the participant or beneficiary. The plan or insurer is required to:

1. Provide the cost-sharing information in paper form, in accordance with the requirements for the internet based self-service tool; and
2. Mail the cost-sharing information no later than 2 business days after an individual's request is received.

Disclosure to the Public Information To Be Provided A group health plan or health insurance issuer offering group coverage must make available on an internet website the following information:

1. A negotiated rate file that has
   1. The name and Employer Identification Number (EIN) or Health Insurance Oversight System (HIOS) identifier, as applicable, for each plan option or coverage offered by a health insurance issuer or group health plan;
   2. A billing code or other code used by the group health plan or health insurance issuer to identify covered items or services for purposes of claims adjudication and payment, and a plain language description for each billing code; and
   3. Negotiated rates that are:
      1. Reflected as dollar amounts, with respect to each covered item or service under the plan or coverage that is furnished by an in-network provider;
      2. Associated with the National Provider Identifier (NPI) for each in-network provider; and
      3. Associated with the last date of the contract term for each provider-specific negotiated rate that applies to each covered item or service, including rates for both individual items and services in a bundled payment arrangement.
2. An out-of-network file that has
   1. The name and Employer Identification Number (EIN) or Health Insurance Oversight System (HIOS) identifier, as applicable, for each plan option or coverage offered by a health insurance issuer or group health plan;
   2. A billing code or other code used by the group health plan or health insurance issuer to identify covered items or services for purposes of claims adjudication and payment, and a plain language description for each billing code; and
   3. Unique out-of-network allowed amounts with respect to covered items or services furnished by out-of-network providers during the 90-day time period that begins 180 days prior to the publication date (with an exception for when there are fewer than 10 different claims for payments). Each unique out-of-network allowed amount must be:
      1. Reflected as dollar amounts, with respect to each covered item or service under the plan or coverage that is furnished by an out-of-network provider; and
      2. Associated with the National Provider Identifier (NPI) for each in-network provider.

Method and Format Required The information disclosed to the public must be made available in the form of two machine-readable files in a form and manner determined by the agencies: one for in-network providers and the other for out-of-network providers. The machine-readable files must be publicly available and accessible to any person free of charge and without conditions, such as establishment of a user account, password, or other credentials, or submission of personally identifiable information to access the file. A group health plan or health insurance issuer must update the machine-readable files and information required by the regulation monthly. The date that the files were updated must be clearly indicated. Special Rules to Prevent Unnecessary Duplication Insured plans can satisfy the requirements for disclosure if the plan requires the health insurance issuer to provide the information pursuant to a written agreement. If there is such an agreement, and the issuer fails to provide the information, then the insurer, but not the plan, violates the transparency requirements. A group health plan (self-insured or fully insured) or health insurer may satisfy the requirements for disclosure to the public by entering into a written agreement under which another party (such as a third-party administrator or health claims clearinghouse) will provide the information required. However, if the contracted party fails to provide the information in compliance with the regulation, the group health plan or health insurance issuer violates the transparency requirements. Cheiron Observation: Self-insured plan sponsors would need to take care that their TPA stays in compliance. Agencies' Assumption As stated in the preamble of the proposed regulations, the agencies assume that fully-insured group health plans will rely on health insurance issuers to develop and maintain the internet-based self-service tool and disclosure in paper form. The agencies also assume that self-insured plans would rely upon TPAs (including issuers providing administrative services only and non-issuer TPAs) to develop the required internet-based self-service tool. Although, not explicitly stated, the agencies may expect the same entities to develop the machine readable files for the public. Cheiron Observation: The proposed requirement to make negotiated rates available to the public will likely be opposed by insurers as they regard their rate schedules for providers as proprietary information. COMMENTS REQUESTED ON QUALITY The agencies have asked for comment whether the self-service tool should be required to have the quality rating of the provider, if the plan or issuer has available data on provider quality. More generally, the agencies are interested in input on:

1. Whether, in addition to the price transparency requirements, the agencies should impose requirements for the disclosure of quality information for providers?
2. Whether health care provider quality reporting and disclosure should be standardized across plans and issuers, or if plans and issuers should have the flexibility to include provider quality information that is based on metrics of their choosing, or state-mandated measures?
3. What type of existing quality of health care information would be most beneficial to beneficiaries, participants, and enrollees in the individual and group markets? How can plans and issuers best enable individuals to use health care quality information in conjunction with cost-sharing information in their decision making before or at the time a service is sought?
4. Would it be feasible to use health care quality information from existing Center for Medicare Services (CMS) quality reporting programs for in-network providers in the individual and group markets?
5. Could quality of health care information from state-mandated quality reporting initiatives or quality reporting initiatives by nationally recognized accrediting entities be used to help participants, beneficiaries, and enrollees meaningfully assess health care provider options?
6. What gaps are there in current measures and reporting as it relates to health care services and items in the individual and group markets?

The agencies are also interested in understanding any limitations plans and issuers might have in reporting on in-network provider quality in the individual and group markets. The agencies want more information about how and if quality data is currently used within plans' and issuers' provider directories and cost-estimator tools. The agencies further want information on the data sources for quality information, and whether plans and issuers are using internal claims data or publicly-available data. Cheiron Observation: The agencies have requested a lot of information concerning quality and seem to be cautious in taking a position. Cheiron is an actuarial consulting firm that provides actuarial and consulting advice. However, we are neither attorneys nor accountants. Accordingly, we do not provide legal services or tax advice.

¹See definition in § 2590.715-2711(d)(6) of the DOL regulations.