May 07, 2024
RxDC Reporting is due to CMS by June 1, 2024
2023 Prescription Drug Data reporting is due June 1, 2024.
As of the publication of this article, reporting of Rx Data is due to CMS in a little over 3 weeks.
Most employers sponsoring group health plans that provide prescription drug coverage, regardless of size or funding vehicle (fully insured, self-funded and level funded), have some role to play in the RxDC process. There have been letters from carriers and vendors requesting information to begin preparing for the reporting over the past couple months, so below is a refresher on the RxDC reporting requirements and responsibilities.
In accordance with the Consolidated Appropriations Act, 2021 (CAA), health plans, including grandfathered plans, and health insurance carriers are required to submit certain information about prescription drug and health care spending to the agencies annually. The agencies plan to use this information to issue public reports on prescription drug pricing costs and trends.
RxDC reporting collects information on prescription drug and health care spending, including:
- General information regarding the plan or coverage
- Enrollment and premium information, including premiums paid by employees versus employers
- Total health care spending, broken down by type of cost (hospital care; primary care; specialty care; prescription drugs; and other medical costs), including prescription drug spending by enrollees versus employers and carriers
- The 50 most frequently dispensed brand prescription drugs
- The 50 costliest prescription drugs by total annual spending
- The 50 prescription drugs with the greatest increase in plan expenditures from the previous year
- Prescription drug rebates, fees, and other remuneration paid by drug manufacturers to the plan or carrier in each therapeutic class of drugs, as well as for the 25 drugs that yielded the highest amount of rebates
- The impact of prescription drug rebates, fees, and other remuneration on premiums and out-of-pocket costs
RxDC reporting requirements apply to group health plans, but not account-based plans such as health reimbursement arrangements (HRAs) or excepted benefits (e.g., limited-scope dental or vision, onsite clinics, and many employee assistance programs (EAPs)).
Detailed reporting instructions, including templates for the various data files and other important information, can be found on the CMS RxDC Website.
Reporting Responsibilities
Most employer-sponsored health plans rely heavily on their carriers, TPAs, and PBMs to provide the data necessary to report to CMS. Some vendors will submit the reporting on behalf of employer client plans. However, others may choose to instead provide the data to the employer with the expectation that the employer will submit their own data to CMS. Any organization submitting data to CMS is referred to as a “reporting entity.”
It is possible that multiple reporting entities will submit files separately on behalf of a single group health plan in order to provide CMS with all required data and files. In some cases, separate vendors may include the employer’s data in the same file type (e.g., a PBM and a separate specialty drug vendor both must report their drug data for the year in files D3-D8, or separate TPA/PBMs within the same plan year submit files D1-D2). This relieves the employer from having to collect and consolidate the information from separate vendors into a single data file (although that is an option as well).
As an industry, how carriers, TPAs, PBMs and other vendors of prescription drug coverage handle the RxDC reporting still varies greatly.
- The carrier or TPA may reach out to employers to ask for information about premium splits (employer and employee contributions) – see our Brief on how the premiums are to be calculated. They may also request the employer to furnish other data required for the D1 file at the same time. For employers that offer a fully insured plan where all prescription drug coverage is handled by the carrier, once this information is provided to the carrier, the carrier will generally handle the RxDC reporting. However, if the employer fails to timely respond, the employer may have to file a P2 and D1 file for the group health plan.
- A few carriers and TPAs have decided they will file only fields D2-D8, but not the D1, in which case the employer is responsible for submitting the P2 and D1 files on its own.
- For employers using vendors that will not handle the RxDC reporting (only help provide data), or for employers that use multiple unrelated vendors to provide prescription drugs coverage (e.g., separate TPAs and PBMs, or carve-out drug coverage or stand-alone telehealth), the employer may have to take a more significant role in determining which vendors are reporting which files, and perhaps even consolidating information and submitting more of the files itself.
Keep in mind, for carriers, TPAs, PBMs, and other vendors who do handle the RxDC reporting on behalf of group health plans, most will submit aggregated data for all of their clients and will not provide plan-specific data to the employer.
Employers and vendors face many challenges to complete the required RxDC reporting, and CMS understands that the data will not be perfect. Employers must annually coordinate with their vendors to determine how much of the reporting will be done by the vendor, and what, if anything, the employer needs to do to complete the process, but hopefully employers and vendors have started settling into a process as we enter the 3rd round of RxDC reporting.
Note: A penalty of $100 per day for the period of noncompliance could apply for failing to timely file the report.
More Resources
RxDC Resources on amwinsconnect.com
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