In its “Top 10 health, leave, benefit, compliance and policy issues in 2024,” Mercer reported on new regulatory developments employer-sponsored health plans may need to comply with in 2024. Among the issues gaining most attention are the new mental health parity rules which are proposed for 2025, as well as additional plan transparency requirements and prescription drug initiatives. That’s on the federal level. Closer to home, plan sponsors must also comply with evolving state regulations including those focused on prescription drug prices and paid family leave. Litigation is very active now and expected to continue into 2024 relating to such matters as surprise billing, preventive care measures put forth by the Affordable Care Act and ERISA preemption of state benefit laws such as those dealing with prescription drug benefits.
One of the highlights of what is on the horizon is increased congressional activity. Both houses are focused on reducing healthcare costs by driving more transparency and competition. There are various pending bills targeting pharmacy benefit manager (PBM) practices, expanding transparency, and improving access to mental healthcare. Additionally, there are bills focused on reducing ACA’s reporting requirements.
Health Plan Sponsors Take Note of…
Currently, projections are that it is more than likely some of this legislation will become effective in 2025, but nonetheless, plan sponsors should be prepared for possible 2024 changes such as those relating to:
- States – It is expected that most states will continue to implement family leave laws, reforms related to prescription drug pricing, and mandates regarding health insurance coverage.
- Court Actions – Litigation is expected to ensue especially relating to measures put forth by the Biden administration to expand healthcare reforms. There will be continued legal challenges to ACA’s preventive services mandate and surprise billing regulations. Along with this litigation, there will be continued legal actions targeting ERISA’s preemption of state PBM laws and regulations which will have major ramifications for pharmacy benefit programs.
Among some of the specifics relating to these potential developments in 2024-2025 are:
- PBM annual disclosures to plan sponsors regarding rebates and fees,
- Introducing a broad commercial market ban on PBM’s spread pricing; which is when a PBM charges a plan sponsor more than the amount reimbursed to the drug dispensing pharmacy, and
- Requiring a study of how vertical integration in the pharmacy sector affects Medicare drug costs and spending.
Planning Strategies
To remain abreast of potential developments affecting health plan compliance, plan sponsors should start planning ahead and stay informed regarding issues surrounding new and emerging drugs, as well as drug alternatives.
Other areas which demand the ongoing attention of health plan sponsors are those pertaining to group health plan transparency. Mercer advises plan sponsors to prepare to offer the self-service cost-comparison tool, making data available, confirming that machine-readable files are updated monthly, and that accurate, complete files are maintained.
Other planning measures recommended are to verify that plans subject to the MHPAEA (Mental Health Parity and Addiction Equity Act) comply with the legislation; have a written compliance analysis of nonquantitative treatment limitations and verify the plan’s comparative analysis conforms with agency guidelines. Additionally, health plan sponsors should be mindful of:
- ERISA fiduciary issues to ensure that their plan’s fiduciaries are in compliance,
- Assessing cybersecurity measures to protect plan member’s privacy and personal data while taking steps to mitigate any system vulnerabilities,
- Verifying that emergency medical services are covered to the extent required and that related claims are properly managed,
- Making certain that plan administrators are complying with cost-sharing,
- Adherence to the external review requirements of the No Surprises Act.
These are just some of the areas requiring health plan sponsors’ attention. In addition to your third party administrator or benefits consultant, additional information on this topic can be found both on the U.S. Congress website, state websites and industry publications focused on employee benefits.
