On October 29, 2020, HHS and the Departments of Labor and Treasury finalized a Transparency in Coverage Final Rule requiring most health plans and issuers in the individual and group commercial markets to disclose cost-sharing estimates and additional content to enrollees upon request, and to publicly post negotiated in-network provider rates, historical out-of-network allowed amounts and billed charges, and drug pricing information, including negotiated rates and historical net prices. In addition, the rule amends the medical loss ratio (MLR) methodology to allow insurers to claim credit for shared savings payments made to an enrollee as the result of selecting a lower-cost, higher-value provider.
The final rule is the latest in a number of Administration efforts to increase price transparency for healthcare services in order to empower consumers to make informed decisions and to foster price competition in the healthcare market. Beyond consumer empowerment, however, HHS clearly articulates that its principle focus is on counteracting price distortions and driving prices down in the commercial market. Therefore, just as the Hospital Price Transparency Final Rule, published in November in 2019 and set to take effect January 2021, has faced strong stakeholder opposition and been the subject of legal challenge, so too this final rule may likely be challenged by health plans and other industry stakeholders. Indeed, HHS clearly anticipates that this rule will face legal challenges and has included severability clauses as part of the rule so that even if a portion of the rule is challenged successfully, other provisions of the rule might continue to survive.