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Upcoming Reporting Deadline for Rx & Healthcare Spending

By Erica Honig, J.D., Compliance Director, Employee Benefits


Upcoming Reporting Deadline for Rx & Healthcare Spending

The Consolidated Appropriations Act of 2021 (CAA), passed by Congress in December 2020, included a requirement for group health plans (and health insurers) to submit detailed prescription drug pricing and healthcare spending data to the Centers for Medicare & Medicaid Services (CMS).[1] This data, referred to as the RxDC report, will be collected and aggregated by CMS to publish public reports on prescription drug pricing trends starting in 2023. The publication of these reports are intended to enhance healthcare and prescription cost transparency.

The original deadline for plans to submit the RxDC reports for 2020 and 2021 was December 21, 2021. As we previously reported back in December 2021, this deadline was extended by the Departments to December 27, 2022. Read on for important information regarding this upcoming reporting deadline.

Covered Plans Subject to Reporting

The RxDC reporting requirement applies to most employer-sponsored group health plans, including fully-insured and self-funded/level-funded plans. Grandfathered plans, church plans subject to the Internal Revenue Code, student health plans, and governmental plans are also subject to this reporting requirement.

The following plans are not subject to the RxDC reporting requirement: account-based plans (such as HRAs, HSAs, and FSAs); excepted benefits such as employee assistance programs, hospital indemnity, and accident-only plans; dental and vision plans; and retiree-only plans.

Required Reporting Data

The RxDC reports are required to include the following information:

  • General information regarding the plan or coverage (including plan name, plan number, plan year, employer size, and plan sponsor’s principal place of business);

  • Enrollment and premium information, including average monthly premiums paid by employees versus employers (for self-funded plans, the premium equivalents);

  • Total healthcare spending, broken down by type of cost (hospital care; primary care; specialty care; prescription drugs; and other medical costs, including wellness services), including prescription drug spending by enrollees versus employers and issuers;

  • The 50 most frequently dispensed brand prescription drugs;

  • The 50 costliest prescription drugs by total annual spending;

  • The 50 prescription drugs with the greatest increase in plan or coverage expenditures from the previous year;

  • Prescription drug rebates, fees, and other remuneration paid by drug manufacturers to the plan or carrier in each therapeutic class of drugs, as well as for each of the 25 drugs that yielded the highest amount of rebates; and

  • The impact of prescription drug rebates, fees, and other remuneration on premiums and out-of-pocket costs.

Reporting Process

The required RxDC reporting data must be submitted to CMS through its reporting module called Health Insurance Oversight System (HIOS). Instructions on how to create an account in the HIOS module can be accessed here. Click here for CMS-issued guidance and resource materials with detailed information on the reporting process.

Reporting Entities

Plan sponsors should rely on their vendors to submit the RxDC reporting data to CMS on their behalf since these providers compile and maintain the required data on behalf of the plans and are in the best position to complete the technical reporting requirements.

Vendors include insurance carriers, third-party administrators (TPAs), pharmacy benefit managers (PBMs), and external data reporting service providers. These vendors are considered “reporting entities” and may impose additional fees for reporting the data to CMS.

Depending on a particular plan design (a carved-out pharmacy benefit within a self-funded plan, for example), multiple reporting entities may be required to work together and coordinate the data compilation and submission efforts on behalf of the plan to CMS.

Reporting Periods

RxDC reporting data is collected and reported on a calendar year basis (referred to as the reference year), regardless of the plan year.

If a plan changes vendors during the reference year (such as changing a TPA or PBM), two reporting options are available:

  1. The previous service provider reports the data from earlier in the year and the new vendor reports the data from later in the year; or

  2. The previous vendor provides the data to the new vendor and the new vendor reports the entire year of data.

In either case, the plan sponsor must ensure that all the required data is reported and that it is not double reported.

Reporting Deadlines

Data for the 2020 and 2021 reference years must be reported by December 27, 2022. Data for subsequent reference years must be reported to CMS by June 1 of the calendar year following the reference year. So, data for the 2022 reference year will be due on June 1, 2023.

Next Steps for Employers

  • Fully-Insured Medical Plans: Employers with fully-insured medical plans should rely on their insurance carriers to submit the RxDC report since the carrier is directly responsible for compliance. For good measure, fully-insured plan sponsor employers are encouraged to receive written confirmation from their carriers that they will be submitting the report(s) in a timely manner, well in advance of the first reporting deadline of December 27, 2022.

  • Self-Funded Plans: Employers with self-funded medical plans (including level-funded plans) are directly responsible for this reporting requirement but should still contract with their vendors (e.g., TPAs and/or PBMs) to report the data on their behalf via a written agreement. However, as with most compliance obligations, if a vendor fails to submit the required data, the self-funded plan bears the ultimate responsibility for such failures.

Some vendors have already reached out to plan sponsor employers via email regarding this upcoming reporting deadline with instructions for next steps. Employers are advised to take note of this upcoming deadline and promptly respond to vendor requests for further information to ensure timely completion and submission of their RxDC reports.

Risk Strategies is committed to keeping employers informed and up-to-date. Contact us at benefits@risk-strategies.com.


[1] CMS is working on behalf of the Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Department of the Treasury (collectively, the Departments) with respect to this data collection effort in accordance with the CAA.


The contents of this article are for general informational purposes only and Risk Strategies Company makes no representation or warranty of any kind, express or implied, regarding the accuracy or completeness of any information contained herein. Any recommendations contained herein are intended to provide insight based on currently available information for consideration and should be vetted against applicable legal and business needs before application to a specific client.

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