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CMS Issues RxDC Instructions for 2022 Data Submissions

Employers should review updated prescription drug data collection (RxDC) instructions for 2022 reference year submissions due June 1, 2023.

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May 11, 2023

On March 3, 2023, the Centers for Medicare and Medicaid Services (CMS) published updated instructions on March 3, 2023 for the prescription drug data collection (RxDC) requirements for employer plan sponsors enacted by the Consolidated Appropriations Act, 2021 (CAA ’21). The revised instructions are for the 2022 reference year data submissions due by June 1, 2023. Previous instructions were published for the initial RxDC submissions for the 2020 and 2021 reference years.

Key Action

Review updated RxDC instructions and prepare for 2022 data submission due by June 1, 2023.

Background

CAA ’21 established new requirements on group health plans (plans) and issuers of group or individual health insurance (issuers) to report specific prescription drug and plan spending data to the Departments of Labor (DOL), Health and Human Services (HHS), and Treasury/Internal Revenue Service (collectively the Departments). The required data includes general information regarding the plan or coverage, total spending by the plan or coverage broken down by type of costs, spending by therapeutic category, the top 50 most frequently dispensed and top 50 most costly drugs, among other data. The Departments will utilize the collected data to issue biannual reports on plan and issuers’ prescription drug reimbursements, pricing trends, and the impact on prescription drug costs on health plan premiums.

CAA ’21 initially imposed a December 27, 2021 deadline for plans and issuers to submit RxDC reports with 2020 data. However, the Departments issued FAQs (Part 49) on August 20, 2021 deferring enforcement for one year. Plans and issuers were required to submit data for both the 2020 and 2021 reference years by December 27, 2022. Beginning with the 2022 reference year reporting, plans and issuers must submit data by June 1, 2023, and by June 1 annually thereafter.

On December 23, 2022, the Departments issued additional FAQs (Part 56) providing enforcement relief and a submission grace period for the initial submission for 2020 and 2021 reference year data. In conjunction with this guidance, the Departments indicated they would not take enforcement action against any plan or issuer that used a “good faith, reasonable interpretation” in making their initial RxDC submissions.

Although the Departments indicated in FAQs Part 56 that they would monitor stakeholder compliance efforts to determine whether additional guidance would be needed, the temporary good faith relief and submission grace period did not extend to 2022 reference year submissions due June 1, 2023.

The Business Group has previously covered the RxDC submission requirements in detail, including recent FAQs and trainings from the Centers for Medicare and Medicaid Services (CMS). See our August 2022, December 2022 and January 2023 Regulatory & Compliance webinars for deeper dives into the RxDC requirements.

Instructions for 2022 Reference Year Submissions

The RxDC instructions provide detailed information on the reporting requirements, who must report the required data and by what deadline and include detailed explanations of the different data elements and data aggregation rules. The instructions also outline the RxDC submission process through the Health Insurance Oversight System (HIOS).

Some of the changes adopted by CMS for the 2022 reference year instructions include:

  • Confirmation that RxDC reporting requirements do not apply to retiree-only plans;
  • Allowing multiple vendors may submit data files on behalf of the same plan, issuer or carrier;
  • Continued suspension of data aggregation restrictions that was extended under ACA FAQs Part 56;
  • Renaming of certain data columns in the data files (D1 – D8)
  • Providing additional guidance on how stop loss reimbursements should be included in the reported data; and
  • Providing additional guidance on reporting prescription drug rebate data.

Next Steps

Employer group health plan sponsors must submit data reports for the 2022 reference year by June 1, 2023. Plan sponsors should review the revised instructions with legal counsel and should watch for additional guidance from Federal regulators that may be issued prior to the June reporting deadline. Plan sponsors should continue working with all vendors to ensure applicable reporting entities are prepared to file by the deadline, and/or are prepared to supply directly to the plan sponsor data that requires aggregation with data from another entity. Plan sponsors – particularly those who have multiple vendors or complex vendor arrangements – are encouraged to maintain documentation of any extenuating circumstances that may impact or prevent submission of single data files for the plan.

Business Group on Health continues to engage with the Departments and advocate for further guidance, compliance relief and resources for reporting entities. The Business Group and other stakeholders sent a letter to the Departments prior to the 2020 and 2021 reference year submission deadline, and we were pleased the Departments included some of the requests we made in the ACA FAQs Part 56 for the initial RxDC submission (e.g., providing plans and issuers with a submission grace period and good faith compliance relief). However, this guidance was not extended to the 2022 reference year submissions. The Business Group continues to advocate that the Departments extend similar relief for 2022 data submissions, along with issuing additional written guidance and allowing public comment on future versions of the reporting instructions.

Business Group on Health will continue to keep members informed of subsequent developments.

Resources

If you have questions, comments, or concerns about these or other regulatory and compliance issues, please contact us.

We provide this material for informational purposes only; it is not a substitute for legal advice.

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