Prescription drug data collection (RxDC) is the new reporting process required by Section 204 of the Consolidated Appropriations Act, 2021 (CAA). The reporting is meant to capture data on prescription drug (Rx) pricing trends, reimbursement amounts including rebates, identify how Rx costs impact health insurance premiums and participant out-of-pocket costs, and promote transparency. In addition to Rx drug information, the RxDC report also collects information on total spending on health care services, including health care premium, enrollment, and spending broken down by hospital costs, provider and clinical service costs for primary and specialty care (separately), and other medical costs, including wellness services.

Understanding the reporting process has led to much confusion for all involved, from plan sponsors and health insurance insurers to service providers like third-party administrators (TPAs) and pharmacy benefit managers (PBMs).

Updated Instructions Released March 3, 2023

As with other reporting requirements from the CAA, the RxDC process has been delayed several times while the guidance and instructions were developed and released to the public. On March 3, 2023, the Centers for Medicare and Medicaid Services (CMS) released a revised, step-by-step instruction guide for 2022 data titled CMS Prescription Drug Data Collection (RxDC) Reporting Instructions.

From the instructions, page 3 lists 15 significant changes from the instructions released in 2022. Highlights include:

  • Added specifications for Rx rebates and stop-loss reimbursements.
  • Added options for multiple vendors to submit the same data file on behalf of the same plan, issuer, or carrier. 
  • Added options for a reporting entity to create multiple submissions in the CMS Health Insurance Oversight System (HIOS) for the same reference year.
  • Renamed columns in data files. For example, CMS renamed column J in D1 from “ASO/TPA Fees Paid” to “Admin Fees Paid” to reflect that self-funded plans pay administrative fees to other types of companies, such as PBMs.

Below is a resource list of analysis from consultants and attorneys for the 2022 RxDC requirements:

For more background on the entire process, view our November 17, 2022 webcast Prescription Drug Data Collection (RxDC)—What You Need to Know About the Required CMS Reports. This helpful overview provides details on the reporting process, how to use the instruction guide, and an in-depth Q&A section.

Who Must Submit Reporting?

Group Health Plans, including:

  • Both grandfathered and non-grandfathered plans
  • Fully insured plans
  • Self-insured plans
  • Non-federal government plans
  • Church plans, and
  • Federal Employees Health Benefits plans

Health Insurance Insurers, including those offering:

Future Reporting Deadlines

  • June 1, 2023 covering 2022 data
  • June 1 of all subsequent years for the prior year’s data

Submission Process

  • New users to the HIOS portal must register and set up an account.  The process may take time, so plan accordingly.
  • CMS has published a Quick Reference Guide for this process.

Reporting Does Not Apply To

  • Account-based plans like health reimbursement arrangements (HRAs)
  • Retiree-only plans
  • Excepted benefits including short-term limited duration, standalone dental or vision, and disease-specific insurance plans
  • Medicare Advantage and Part D plans
  • Medicaid plans
  • CHIP plans

Plan Sponsors’ Responsibility

Plan sponsors have the ultimate responsibility for the reporting accuracy and timeliness. Third parties like TPAs, PBMs, or health insurance carriers will generally assist with reporting, but the plan sponsor should access and review the reports that are submitted on their behalf.  Obtaining and understanding the reports produced by third parties may be problematic for some plan sponsors as the data might not typically be shared with them.

Plan sponsors should also update their contract language with their service providers to reflect this new reporting responsibility. 

Developed by International Foundation Information Center staff. This does not constitute legal advice. Please consult your plan professionals for legal advice.

Anne Newhouse

Information/Research Specialist at the International Foundation of Employee Benefit Plans Favorite Foundation Service: The Information Center! Members having the ability to have an information specialist research their topic is a great benefit. Favorite Foundation Moment: Attending the 2013 CEBS conferment ceremony in Boston as an official CEBS graduate. Benefits Related Topics That Interest Her Most: Benefit communication—helping employers understand what employees want and the way they want it communicated to them. Personal Insight: Anne may spend her days in the International Foundation employee benefits library, patiently researching answers to member questions—but after work, she’s ready to move with a bike, hike or walk in the great outdoors.

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