What's New | Articles & Press Releases
Upcoming "Gag Clause Attestation" Deadline Leaves a Sour Taste in Plan Administrators' Mouths
The deadline is looming for a new requirement that group health plans submit a sworn statement that they have not entered into agreements that improperly limit their ability to disclose required information – a statement that goes by the unwieldy name Gag Clause Prohibition Compliance Attestation (“GCPCA”). The last day to submit the attestation is December 31, 2023, the end of the Plan Year for many multiemployer benefit plans. Although the attestation itself appears relatively simple to submit, the implications underlying the attestation have left some plan administrators hesitating before hitting “enter.”
What is the GCPCA?
Implemented by the Consolidated Appropriations Act, 2021, the GCPCA is a joint creation of the Departments of Labor, Health and Human Services, and the Treasury (collectively, the “Departments”). Submission of the GCPCA indicates compliance with the requirements outlined in § 724 of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Of particular importance to multiemployer benefit plans, ERISA § 724 generally prohibits a group health plan offering group or individual health coverage from entering into agreements with certain classes of service providers (including health care providers, business associates, and third-party administrators) if those agreements limit the provision of certain information. Specifically, a plan may not enter into an agreement that would, either directly or indirectly, prevent or prohibit the plan from disclosing information or data related to cost or quality of care to plan participants (enrolled or eligible to enroll), beneficiaries, business associates, and various other parties. In layman’s terms, a group health plan cannot enter into an agreement that would “gag” it and keep the plan from providing certain important health coverage information to covered individuals.
Plans are required to submit their first GCPCA by December 31, 2023, attesting that the plan has been and continues to be compliant with ERISA § 724’s gag clause prohibition since December 27, 2020, the date Congress passed the 2021 Consolidated Appropriations Act. The Departments have even set up a user-friendly web portal to facilitate submission.
Why are some plan administrators hesitant to attest?
Critically, the phrasing of the gag clause prohibition places the responsibility to avoid gag clauses on the plan, rather than the service provider; furthermore, with so few health care service provider options available, plans often have little bargaining power in negotiating gag clauses out of their agreements with service providers and, with the onus resting on plans, service providers lack incentive to remove gag clauses from their standard contractual language. Plan administrators, then, are left with two unpalatable options if their agreement with a service provider does appear to contain a gag clause: Either refuse to submit the GCPCA, leaving the plan at the mercy of ERISA’s sanctions and penalties; or submit a false attestation of compliance.
Where do we go from here?
Some small relief has come in recent months. The Departments have noted in several “FAQ” publications that service providers may submit the GCPCA on a plan’s behalf, taking some of the teeth out of the catch-22 discussed above. Additionally, on December 11, 2023, the United States House of Representatives passed the “Lower Costs, More Transparency” Act (the “Act”). In part, the Act would allow a group health plan that is unable to obtain the information or data needed to submit the GCPCA from its service provider(s) to instead submit a written statement detailing: (1) the plan’s inability to obtain the required information, (2) the efforts the plan took in attempting to obtain the required information, and (3) a description of the service provider(s)’ response to the inquiry, if any. Its introduction shows a willingness on Congress’s part to address group health plans’ concerns and provide a potential “middle road” for plan administrators. Despite these efforts, some service providers have already refused to submit the GCPCA on a plan’s behalf, and the Act must still go through both the Senate and the President, meaning it is exceptionally unlikely that the written statement option will be available to plan administrators prior to the December 31, 2023 GCPCA due date. Without relief options, many plans will be forced to choose between a rock and a hard place this year. Multiemployer benefit plans (and their legal teams) will have to wait to see the fallout from the GCPCA as 2024 arrives.
__________
See § 201 of the Consolidated Appropriations Act, 2021, alternately encoded at 42 U.S.C. § 300gg-119.
See U.S. Centers for Medicare and Medicaid Services overview, available at: https://www.cms.gov/marketplace/about/oversight/other-insurance-protections/gag-clause-prohibition-compliance-attestation.
42 U.S.C. § 300gg-119(a)(1).
See Q6 of the 57th Set of FAQ on the Affordable Care Act and Consolidated Appropriations Act, 2021, available at: https://www.cms.gov/files/document/aca-part-57.pdf.
Available at: https://hios.cms.gov/HIOS-GCPCA-UI, and viewable after entering login credentials.
The online GCPCA form also does not allow a plan to “tell on itself,” so to speak. The submission user manual, available at https://www.cms.gov/files/document/hios-gcpca-usermanual-03_00_00_112023.pdf, shows on pages 30-33 that submission of the GCPCA reflects a sworn statement of compliance with ERISA § 724, with no obvious means for the attester to inform the Departments of any noncompliance on the plan’s part.
See, for example, Q9 of the 57th Set of FAQ on the Affordable Care Act and Consolidated Appropriations Act, 2021, linked above.
Originally introduced on September 8, 2023; see Title IV, Section 401(b) of the Act, available at: https://www.congress.gov/bill/118th-congress/house-bill/5378/text.
See the Action List, available at: https://www.congress.gov/bill/118th-congress/house-bill/5378/all-actions.
What is the GCPCA?
Implemented by the Consolidated Appropriations Act, 2021, the GCPCA is a joint creation of the Departments of Labor, Health and Human Services, and the Treasury (collectively, the “Departments”). Submission of the GCPCA indicates compliance with the requirements outlined in § 724 of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Of particular importance to multiemployer benefit plans, ERISA § 724 generally prohibits a group health plan offering group or individual health coverage from entering into agreements with certain classes of service providers (including health care providers, business associates, and third-party administrators) if those agreements limit the provision of certain information. Specifically, a plan may not enter into an agreement that would, either directly or indirectly, prevent or prohibit the plan from disclosing information or data related to cost or quality of care to plan participants (enrolled or eligible to enroll), beneficiaries, business associates, and various other parties. In layman’s terms, a group health plan cannot enter into an agreement that would “gag” it and keep the plan from providing certain important health coverage information to covered individuals.
Plans are required to submit their first GCPCA by December 31, 2023, attesting that the plan has been and continues to be compliant with ERISA § 724’s gag clause prohibition since December 27, 2020, the date Congress passed the 2021 Consolidated Appropriations Act. The Departments have even set up a user-friendly web portal to facilitate submission.
Why are some plan administrators hesitant to attest?
Critically, the phrasing of the gag clause prohibition places the responsibility to avoid gag clauses on the plan, rather than the service provider; furthermore, with so few health care service provider options available, plans often have little bargaining power in negotiating gag clauses out of their agreements with service providers and, with the onus resting on plans, service providers lack incentive to remove gag clauses from their standard contractual language. Plan administrators, then, are left with two unpalatable options if their agreement with a service provider does appear to contain a gag clause: Either refuse to submit the GCPCA, leaving the plan at the mercy of ERISA’s sanctions and penalties; or submit a false attestation of compliance.
Where do we go from here?
Some small relief has come in recent months. The Departments have noted in several “FAQ” publications that service providers may submit the GCPCA on a plan’s behalf, taking some of the teeth out of the catch-22 discussed above. Additionally, on December 11, 2023, the United States House of Representatives passed the “Lower Costs, More Transparency” Act (the “Act”). In part, the Act would allow a group health plan that is unable to obtain the information or data needed to submit the GCPCA from its service provider(s) to instead submit a written statement detailing: (1) the plan’s inability to obtain the required information, (2) the efforts the plan took in attempting to obtain the required information, and (3) a description of the service provider(s)’ response to the inquiry, if any. Its introduction shows a willingness on Congress’s part to address group health plans’ concerns and provide a potential “middle road” for plan administrators. Despite these efforts, some service providers have already refused to submit the GCPCA on a plan’s behalf, and the Act must still go through both the Senate and the President, meaning it is exceptionally unlikely that the written statement option will be available to plan administrators prior to the December 31, 2023 GCPCA due date. Without relief options, many plans will be forced to choose between a rock and a hard place this year. Multiemployer benefit plans (and their legal teams) will have to wait to see the fallout from the GCPCA as 2024 arrives.
__________
See § 201 of the Consolidated Appropriations Act, 2021, alternately encoded at 42 U.S.C. § 300gg-119.
See U.S. Centers for Medicare and Medicaid Services overview, available at: https://www.cms.gov/marketplace/about/oversight/other-insurance-protections/gag-clause-prohibition-compliance-attestation.
42 U.S.C. § 300gg-119(a)(1).
See Q6 of the 57th Set of FAQ on the Affordable Care Act and Consolidated Appropriations Act, 2021, available at: https://www.cms.gov/files/document/aca-part-57.pdf.
Available at: https://hios.cms.gov/HIOS-GCPCA-UI, and viewable after entering login credentials.
The online GCPCA form also does not allow a plan to “tell on itself,” so to speak. The submission user manual, available at https://www.cms.gov/files/document/hios-gcpca-usermanual-03_00_00_112023.pdf, shows on pages 30-33 that submission of the GCPCA reflects a sworn statement of compliance with ERISA § 724, with no obvious means for the attester to inform the Departments of any noncompliance on the plan’s part.
See, for example, Q9 of the 57th Set of FAQ on the Affordable Care Act and Consolidated Appropriations Act, 2021, linked above.
Originally introduced on September 8, 2023; see Title IV, Section 401(b) of the Act, available at: https://www.congress.gov/bill/118th-congress/house-bill/5378/text.
See the Action List, available at: https://www.congress.gov/bill/118th-congress/house-bill/5378/all-actions.
