The Consolidated Appropriations Act added transparency duties to employer health plans.
The Consolidated Appropriations Act, 2021 gave group health plans several duties beyond the No Surprises Act: a ban on gag clauses, disclosure of broker and consultant pay, mental health parity comparative analyses, and annual prescription drug reporting. This page summarizes each one and what an employer should confirm. It is general information, not legal advice.
The Basics for Employers.
A plain-English summary of the four duties employers hear about most.
Gag Clause Ban and Attestation
Plan contracts may not restrict access to cost and quality information. Plans attest to this each year by December 31. Fully insured and self-funded plans both owe it, and there is no participant-count exemption.
Broker and Consultant Pay Disclosure
A broker or consultant expecting $1,000 or more in direct or indirect compensation for services to a group health plan must disclose it in writing to the plan fiduciary before the contract is signed or renewed.
Mental Health Parity Analysis
Plans that apply non-quantitative treatment limits to mental health or substance use benefits must document a comparative analysis showing those limits are no more restrictive than for medical benefits, and produce it on request.
Prescription Drug Reporting
Plans report pharmacy benefit and drug cost data to CMS each year for the prior calendar year, generally by June 1. Most plans rely on the carrier or pharmacy benefit manager to file.
How it plays out.
These duties sit with the plan, not with the broker, so the employer is the one accountable if a filing is missed. On a fully insured plan the carrier usually handles the attestation and the drug reporting, but the plan and the carrier each need to know who is doing what. On a self-funded plan more of the work lands on the employer and its third-party administrator.
The practical step is a short annual checklist: who attested, who filed the drug report, where the broker compensation disclosure is kept, and whether a parity analysis exists for the plan.
What to check.
Attestation Filed
Confirm who submits the gag clause attestation each year, and keep the confirmation. If the issuer submits for a fully insured plan, ask for proof.
Compensation Disclosure on File
Ask your broker or consultant for the written compensation disclosure and keep it with the plan records.
Parity Analysis Exists
Ask the carrier or administrator whether a comparative analysis has been completed for the plan, and where it is kept.
Drug Reporting Confirmed
Confirm the carrier or pharmacy benefit manager is filing the annual drug and spending report for the plan.
Mistakes to avoid.
Assuming Someone Else Did It
The carrier or administrator often files, but the plan remains responsible. Ask for confirmation each year.
Treating It as a Large-Employer Rule
The attestation has no participant-count exemption, so small employers owe it too.
Losing the Paper Trail
Disclosures, attestations and analyses need to be retrievable if a regulator asks.
Where the Rules Come From.
The Consolidated Appropriations Act, 2021 is Public Law 116-260, Division BB, Title II (sections 201 through 204). The related rules below link to the summaries on this site. This is general information, not legal or tax advice, and rules change, so check the current text.
No Surprises Act (Pub. L. 116-260, Div. BB)
Protects patients from many surprise out-of-network bills and sets related plan duties.
Mental Health Parity (29 U.S.C. 1185a)
Requires group health plans to treat mental health and substance use benefits no more restrictively than medical benefits.
ERISA (29 U.S.C. Chapter 18)
The federal law that sets reporting, disclosure and fiduciary rules for employer-sponsored benefit plans.
Quick Answers.
What is the gag clause attestation?
A yearly statement, due by December 31, that the plan has no contract terms restricting access to cost and quality information. Fully insured and self-funded plans both owe it. If the issuer submits for a fully insured plan, the plan and the issuer are both treated as having met the requirement.
Do small employers have to comply?
Yes for the attestation. It has no participant-count exemption. Other duties depend on the plan and who performs the work, so ask the carrier or administrator what they handle.
Does my broker have to disclose compensation?
A broker or consultant expecting $1,000 or more in direct or indirect compensation for services to a group health plan must give the plan fiduciary a written disclosure.
Who files the prescription drug report?
The plan is responsible for it, but carriers and pharmacy benefit managers usually file on the plan’s behalf. Confirm each year who is filing.
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