In a quiet announcement last week, CMS issued a new set of FAQs related to Gag Clause Prohibitions – a provision included in the Consolidated Appropriations Act of 2021. The new FAQs clarify what we’ve argued for so long, that employers and plan sponsors are entitled to all price and quality data as it relates to their contracts with their TPA, provider Networks, or service provider offering access to a network of providers. Plans that engage with 3rd parties with contractual language preventing such data sharing are prohibited transactions.
The Federal government is finally waking up to the massive asymmetry of information in the commercial health plan space. This represents a huge win for plan sponsors. In addition to providing clarity, the FAQs unveil a web portal for plan sponsors to submit complaints or concerns related to their issuer’s compliance related to gag clause prohibitions.
Excerpts from the FAQ:
What is a Gag Clause: A “gag clause” is a contractual term that directly or indirectly restricts specific data and information that a plan or issuer can make available to another party.
How Does Federal Law Prohibit group health plans from entering into agreements that contain gag clauses?
The Code, ERISA and PHS Act generally prohibit group health plans and issuers offering group health insurance from entering into agreements with providers, TPAs, or other service providers that include language that would constitute a “gag clause,” specifically:
(1) restrictions on the disclosure of provider-specific cost or quality of care information or data to referring providers, the plan sponsor, participants, beneficiaries, or enrollees, or individuals eligible to become participants, beneficiaries, or enrollees of the plan or coverage;
(2) restrictions on electronic access to de-identified claims and encounter information or data for each participant, beneficiary, or enrollee upon request and consistent with the privacy regulations promulgated pursuant to section 246(c) of HIPAA, GINA, and the ADA; and
(3) restrictions on sharing information or data described in (1) and (2), or directing that such information or data be shared, with a business associate, as defined in 45 CFR 160.103, consistent with applicable privacy regulations.
Plans will have to submit annual attestations that their contracts do not contain prohibited gag clauses.
