Understanding CAA Pharmacy RX Data Collection Compliance for Small Group Health Plans in California

As we approach the second year of RX Data Collection (RXDC) reporting, it's crucial for small group health plans in California to be aware of and adhere to compliance requirements. This article aims to provide clarity on the reporting obligations, focusing on Fully Insured, California, Small Group (2-100 lives) Health Insurance for the calendar year 2023.

Compliance Deadline: June 1, 2024

It's important to note that all health plans, regardless of size, are subject to these new rules, including church plans and Federal Employees Health benefits. Even those typically exempted from certain health plan compliance obligations under ERISA must comply.

Background: Consolidated Appropriations Act (CAA) of 2021

The CAA introduced transparency-related regulations to improve clarity and accountability in healthcare. The RXDC, mandated by CAA, requires annual reports from plans and insurance issuers on prescription drug costs and overall spending. This initiative empowers the Centers for Medicare & Medicaid Services (CMS) to generate reports for various government agencies, offering insights into drug trends, rebates, and healthcare pricing.

If we no longer have an active policy, do we still need to comply? Yes! If you had a group policy in 2023, you need to follow that carrier’s instructions on reporting information pertaining to 2023.

Action Required by Group Policy Holders – California Plans

Each insurance carrier has specific instructions for compliance:

1.      Aetna: No instructions available as of 2/15/24. Check directly with Aetna for updates.

2.      Anthem Blue Cross (CA): Fully insured Large and Small Group clients will receive an email with a link to an online form for filing. Complete it as soon as possible or contact Anthem for the deadline. Information will be sent to CMS in May 2024.

3.      Blue Shield of California: Active groups should fill out the intake form on the Employer Connection page. Terminated groups should use the provided link emailed to them by April 5, 2024.

4.      CaliforniaChoice: No action required from employers, as CaliforniaChoice is facilitating the RXDC reporting.

5.      Cigna + Oscar: No reporting approach announced as of 2/15/24. Keep checking with Cigna + Oscar for updates.

6.      Health Net: Will fulfill regulatory obligations for 2023 reporting without requesting data from groups. They will not provide communication confirming completion of their reporting.

7.      Kaiser Permanente: Groups will receive an email to complete/verify a form by February 1, 2024. Deadline is March 15, 2024.

8.      Sharp Health Plan: Outreach to employers begins in mid-March. Employers must submit information by the deadline to avoid exclusion from filing.

9.      UnitedHealthcare: Information collection via the employer portal opens on February 14, with a deadline of April 10, 2024.

Penalty Details: $100/day for Non-Compliance

While CMS receives the files, enforcement falls upon the Department of Labor (DOL) and Health and Human Services (HHS). Non-compliance penalties of $100/day may be issued by the Internal Revenue Service (IRS) for health plans that do not comply as required. Stay informed and act promptly to avoid penalties and ensure compliance with the CAA Pharmacy RXDC requirements.

When in doubt, contact your Broker or your health insurer directly.

Would you like some help with this?

I’m Katie Jamie, a licensed insurance broker who specializes in helping California small business owners determine the best health insurance option for their business. I also provide ongoing support to ensure you and your employees have an easy time during enrollment and get all questions answered throughout the year. And, I do an annual review of your policy to ensure you are empowered to make the best decision for your company benefits package every year.

Remember, the right health insurance is not just a financial decision; it's an investment in the success and longevity of your California small business.

So, if you have questions or would like assistance with this or any other group health insurance compliance requirements, the next step is to give me a call now at (714) 681-1230 or click here to book a time to talk: https://calendly.com/katie-magnolia