Departments issue guidance on CAA’s prohibition against gag clauses

On February 23, 2023, the departments of Labor, Health and Human Services (HHS), and the Treasury issued ACA FAQs Part 57 providing guidance on the Consolidated Appropriations Act, 2021 (CAA) requirements prohibiting gag clauses in health plan agreements. Specifically, the CAA prohibits group health plans and issuers offering group health insurance from entering into agreements with providers, third-party administrators (TPAs) or other service providers that include language that would constitute a gag clause. The CAA provision also included a required annual attestation of compliance. The FAQs  include guidance on how employer group health plan sponsors and health insurance issuers may submit the annual Gag Clause Prohibition Compliance Attestation (GCPCA).

The departments have launched a website for submitting attestations, along with instructions, a system user manual, and a Reporting Entity Excel Template for plans and issuers to submit the GCPCA.

The first GCPCA submission is due by December 31, 2023, for the period beginning December 27, 2020, through the date of the attestation. Subsequent attestations are due by December 31 of each year following.

CAA gag clause prohibition requirements

The provisions prohibiting group health plans and issuers from entering into agreements that include gag clauses took effect on December 27, 2020, when the CAA was enacted. On August 20, 2021, the departments issued ACA FAQs Part 49, which clarified that, pending further guidance, plans and issuers should use a good faith, reasonable interpretation of the act to remain in compliance. The departments noted they would issue future guidance explaining how plans and issuers should submit their attestations of compliance.

The new FAQ guidance defines a “gag clause” as a contractual term that directly or indirectly restricts specific data and information that a plan or issuer can make available to another party. Gag clauses in this context might be found in agreements between a plan or issuer and any of the following parties: 1) a healthcare provider, 2) a network or association of providers, 3) a TPA, or 4) another service provider offering access to a network of providers.

The new FAQs also include the following examples of an impermissible gag clause:

• A contract between a TPA and a group health plan that states that the plan will pay providers at rates designated as “Point of Service Rates,” but the TPA considers those rates to be proprietary and therefore includes language in the contract stating that the plan may not disclose the rates to participants or beneficiaries
• A contract between a TPA and a plan that provides that the plan sponsor’s access to provider-specific cost and quality-of-care information is only at the discretion of the TPA

Entities subject to the GCPCA requirements

The FAQs clarify that the following entities are subject to the GCPCA requirements:

• Health insurance issuers offering group health insurance coverage
• Health insurance issuers offering individual health insurance coverage, including student health insurance coverage and individual health insurance coverage issued through an association
• Fully insured and self-insured group health plans, including ERISA plans, non-federal governmental plans and church plans subject to the tax code

These requirements apply regardless of a plan’s grandfathered or grandmothered status. A plan or issuer submitting a GCPCA for its non-excepted benefit plans (e.g., major medical plan) is not required to submit an attestation for any coverage of an excepted benefit (e.g., stand-alone dental/vision plans).

The FAQs also clarify that the following are not subject to the GCPCA requirements:

• Plans or issuers offering only excepted benefits
• Issuers offering only short-term, limited-duration insurance
• Medicare and Medicaid plans
• State Children’s Health Insurance Program (CHIP) plans
• The TRICARE program
• The Indian Health Service program
• Basic Health Program plans

According to the FAQs, the attestation requirement does not apply to health reimbursement arrangements (HRAs) or other account-based group health plans because they do not have a need to enter into agreements with providers. As noted in the FAQs, HRAs and other account-based group health plans will be typically integrated with other coverage that will be required to submit an attestation (such as individual coverage HRAs) or will be exempt from these requirements (such as excepted benefit HRAs).

The newly issued FAQs also include guidance on how plans and issuers may submit their GCPCA as well as report a suspected violation of the gag clause prohibition or related attestation requirements.

Going forward

• Employer plan sponsors of group health plans should submit the annual GCPCA no later than December 31, 2023 (covering the period since December 27, 2020).
• Employer plan sponsors of self-insured group health plans should be aware that the submission can be made by either the plan sponsor or a TPA (a written agreement is required for a TPA to submit the GCPCA on the plan’s behalf); however, the legal requirement to provide a timely GCPCA remains with the self-insured group health plan.
• Employer plan sponsors of fully insured group health plans should note that when the issuer of a fully insured group health plan submits a GCPCA on behalf of the plan, the departments will consider the plan and issuer to have satisfied the attestation submission requirement. Plan sponsors should confirm with their carrier that the GCPCA has been submitted by the deadline.