Transparency in Coverage Proposed Rule (CMS- 9915 –P)
Transparency in Coverage Proposed Rule (CMS- 9915 –P)
The Transparency in Coverage proposed rule released today by the Department of Health and Human Services, the Department of Labor, and the Department of the Treasury (the Departments) are delivering on President Trump’s executive order on Improving Price and Quality Transparency. These proposed rules are a historic step toward putting health care price information in the hands of consumers, advancing the Administration’s goal to ensure consumers are empowered with the information they need to make informed health care decisions.
The proposals in this rule build on actions the Administration has taken to increase price transparency through hospitals by giving patients tools to access pricing information through their health plans. The Administration has finalized requirements for hospitals to disclose their standard charges, including negotiated rates with third-party payers. The proposals in this rule will bring greater transparency across the health care industry.
For too long, Americans have been in the dark about the cost of their health care until after they obtain services and receive a bill. These proposals would require most group health plans, including self-insured plans, and health insurance issuers to disclose price and cost-sharing information to participants, beneficiaries, and enrollees. The Departments are proposing to give consumers real-time, personalized access to cost-sharing information, including an estimate of their cost-sharing liability for all covered health care items and services through an online tool that most group health plans and health insurance issuers would be required to make available to all of their members, and in paper form, at the consumer’s request. This would empower consumers to shop and enable them to compare costs between specific providers before receiving care. Through these proposed rules, plans and issuers would also be required to disclose on a public website their negotiated rates for in-network providers and allowed amounts paid for out-of-network providers. Making this information available to the public is intended to drive innovation, support informed, price-conscious decision-making, and promote competition in the health care industry.
Making Health Care Price Information Accessible for Consumers
These proposed rules include two approaches to make health care price information accessible to consumers and other stakeholders, allowing for easy comparison-shopping.
- First, each non-grandfathered group health plan or health insurance issuer offering non-grandfathered health insurance coverage in the individual and group markets would be required to make available to participants, beneficiaries and enrollees (or their authorized representative) personalized out-of-pocket cost information for all covered health care items and services through an internet-based self-service tool and in paper form upon request. For the first time, most consumers would be able to get estimates of their cost-sharing liability for health care for different providers, allowing them to both understand how costs for covered health care items and services are determined by their plan, and shop and compare costs for health care before receiving care.
- Second, each non-grandfathered group health plan or health insurance issuer offering non-grandfathered health insurance coverage in the individual and group markets would be required to make available to the public, including stakeholders such as consumers, researchers, employers, and third-party developers the in-network negotiated rates with their network providers and historical payments of allowed amounts to out-of-network providers through standardized, regularly updated machine-readable files. This would provide opportunities for innovation to drive price comparison and consumerism in the health care market.
In this rule, HHS also proposes to allow issuers that empower and incentivize consumers through the introduction of plans that include provisions that encourage consumers to shop for services from lower-cost, higher-value providers, and that share the resulting savings with consumers, to take credit for such “shared savings” payments in their medical loss ratio (MLR) calculations. HHS makes this proposal to ensure, should the proposal be finalized as proposed, that issuers would not be required to pay MLR rebates based on a plan design that would provide a benefit to consumers that is not currently captured in any existing MLR revenue or expense category. HHS believes this proposal would preserve the statutorily-required value that consumers receive for coverage under the MLR program, while encouraging issuers to offer new or different value-based plan designs that support competition and consumer engagement in health care.
Requesting Comment on Additional Efforts to Improve Price and Quality Transparency
This proposed rule also solicits comments on:
- Whether group health plans and health insurance issuers should also be required to make available through a standards-based application programming interface (API) the cost-sharing information referenced above that is proposed to be disclosed through the internet-based self –service tool and the machine readable files.
- How health care quality information can be incorporated into the price transparency proposals included in these proposed rules.
Comments are due 60 days from the release of the proposed rule. The Departments are proposing that all components of the rule would be applicable for plan years (or in the individual market policy years) beginning on or after 1 year after the finalization of the rule, except for the MLR provision, which would be applicable beginning with the 2020 MLR reporting year.
The proposed rule can be found here: https://www.hhs.gov/sites/default/files/cms-9915-p.pdf.
 Grandfathered health plans are health plans that were in existence as of March 23, 2010, the date of enactment of PPACA, and that are only subject to certain provisions of PPACA, as long as they maintain status as grandfathered health plans under the applicable rules. Under section 1251 of PPACA, section 2715A of the PHS Act does not apply to grandfathered health plans. These proposed rules would not apply to grandfathered health plans (as defined in 26 CFR 54.9815-1251, 29 CFR 2590.715-1251, 45 CFR 147.140).
 APIs are messengers or translators that work behind the scenes to ensure that software programs can talk to one another. An API can be thought of as a set of commands, functions, protocols, or tools published by one software developer (“A”) that enable other software developers to create programs (applications or “apps”) that can interact with A’s software without the other software developer needing to know the internal workings of A’s software, all while maintaining consumer data privacy standards.