The Consolidated Appropriations Act (CAA) of 2021 prohibits the use of gag clauses in provider contracts to create greater transparency around healthcare costs and quality of care.
Employers and health insurance carriers must submit the annual Gag Clause Prohibition Compliance Attestation by December 31st of each year to attest that their plan agreements comply with the ban on gag clauses.
Let’s look at some of the most recent federal and state regulations governing gag clauses in health plans and best practices for year-long compliance.
Regulatory Framework for Gag Clauses
The CAA has introduced several reforms for employer-sponsored group health plans that have taken effect over a staggered timeframe.
These regulatory changes are designed to eliminate gag clauses and give patients full access to the information they need to make informed decisions about their health care and the cost of care.
Critical Compliance Updates
Organizations are now required to formally acknowledge that they do not enforce, endorse, or include gag clauses within the healthcare policies that they provide to employees or in agreements with insurance providers.
Plan sponsors and health plans are also barred from restricting the issuer or plan from sharing information with business associates, provided that they are following HIPAA’s Medical Health Insurance Privacy Regulations.
Recent Legislation
For fully insured health plans, the law indicates that both employers and health insurance carriers must submit an annual attestation that confirms that there are no gag clauses within provider contracts.
Employers are responsible for making the annual attestation for self-funded health plans. However, they can choose to hire a benefits administrator or third-party administrator (TPA) to submit it on behalf of the company.
Regulatory Guidance
The Department of Labor (DOL) recently issued guidance stating that employers are not required to submit an annual attestation if the health insurance carrier submits one on their behalf. This would be in addition to the carrier submitting its attestation.
To comply with gag clause regulations, companies must attest that they abide by all provisions outlined in the following bodies:
- Employee Retirement Income Security Act (ERISA) Section 724
- Title II (Transparency) of Division BB of the CAA
- Internal Revenue Code Section 9824
- Public Health Service (PHS) Act Section 2799A-9
Implications on
Health Plans and Providers
The attestation requirement applies to group health plans and insurers, including non-federal government plans, ERISA plans, and church plans subject to the Code, including those with grandmothered or grandfathered status.
Gag clause prohibition compliance attestation can have direct implications on health plans and providers.
Compliance Obligations
Understanding gag clause probation requirements is essential for compliance. To meet state and federal requirements, the proper systems must be in place to verify that provider agreements are free from gag clauses.
There are several steps involved in completing and submitting gag clause attestations, including the following:
- Review applicable regulations and laws
- Identify gag clauses
- Become familiar with gag clause requirements
- Create and distribute gag clause attestation forms
- Collect attestations
- Monitor compliance and perform periodic updates
Gag Clause Impact on Patient Rights
Gag clause prohibition was developed to promote transparency in healthcare and eliminate barriers that prevent patients from making informed decisions about their healthcare.
These compliance updates prohibit clauses in agreements that prevent the sharing of key information, such as quality of care, cost, and similar data.
Best Practices for
Gag Clause Compliance
With new federal and state regulations regarding gag clauses in healthcare, employers should begin preparing for compliance now.
They can begin by reviewing their contracts with insurers, health plan service providers, or TPAs to ensure that they do not contain prohibited gag clauses.
Gag Clause Training and Education
Providing staff and stakeholders with comprehensive training on compliance requirements related to gag clauses can help prevent violations and penalties.
Inform the appropriate parties of the latest regulations and ensure that they understand the implications of non-compliance and their obligations.
Compliance Monitoring
Several strategies can help companies effectively monitor and ensure ongoing compliance with gag clause regulations.
First, establish a process for reporting violations or non-compliance with gag clauses. This process may involve procedures for resolving disputes.
Next, perform periodic reviews and renewals based on the contract’s terms. Ensure that the company is prepared to swiftly update and reissue attestations as needed.
Organizations should also maintain all relevant documents regarding gag clauses, including attestation forms, the full text of the gag clauses, and any other related communications.
Always verify that any practices implemented comply with the law and that there is a concise process for addressing potential disputes or other issues. Many businesses will engage in third-party consulting services to ensure organizational understanding and compliance.
Refer to eBen for Gag Clause Guidance
Understanding compliance updates for health plan gag clauses is essential in the rapidly evolving world of healthcare. At eBen, our team of consultants can confidently help you navigate these complexities. Speak with an expert to learn more.
