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FAQs – Transparency in Coverage and Consolidated Appropriations Act [Updated 3/4/22]

Transparency in Coverage and Consolidated Appropriations Act FAQs for Employers

[UPDATED 3/4/22]


Pinnacle Claims Management, Inc. supports transparency efforts to help our members make informed health care decisions. In October 2020, the Departments of Health and Human Services, Labor, and Treasury (collectively referred to as the “Departments”) released the Transparency in Coverage Final Rules (TIC). TIC requires that:

  • Non-grandfathered health plans disclose, on a public website, three machine-readable files disclosing health care rates. The machine-readable files (MRF) must be made public beginning on July 1, 2022 (delayed from January 1, 2022) and contain provider rates for covered medical items and services, (ii) out-of-network allowed amounts and billed charges for covered medical items and services, and (iii) negotiated rates and historical net prices for covered prescription drugs. The files must contain the negotiated rates with in- network providers for all covered items and services as well as historical payments to and billed charges from out-of-network providers. The requirement to post an MRF containing the in-network negotiated rates and historical net prices for all covered prescription drugs by plan or issuer at the pharmacy location level has been deferred until further notice.
  • Health plans make price comparison information available through a web-based self-service tool and in paper form upon request for 500 items and services, for plan years beginning on or after January 1, 2023. Health plans must expand those tools to cover all items and services by January 1, 2024.


On December 27, 2020, the Consolidated Appropriations Act (CAA) was signed into law. The CAA included extensive transparency reforms, including some that appeared to overlap with TIC rules, but with more aggressive deadlines.

On August 20, 2021, CMS issued guidance that deferred enforcement of some of the CAA provisions due to the operational complexities and timeline challenges. For example, the enforcement of key provisions including the prescription drug machine-readable file, advance explanation of benefits, and the price comparison tool have been deferred pending further guidance.

The CAA represents the most significant changes to the private insurance market since the Affordable Care Act. The law:

  • Requires plans to develop and make available price transparency tools, good faith estimates and an advanced explanation of benefits
  • Restricts “surprise billing”
  • Prohibits “gag clauses” in healthcare contracts
  • Adds new mandates for ID cards, provider directories and continuity of care.

These provisions are described in more detail below but note that much of the important detail of this law will be determined by regulations that will be released over the next several months.

What areas will Pinnacle be implementing to help support compliance with the new regulations?

Pinnacle is in the process of developing an implementation strategy for achieving the Transparency requirements.

Will there be a cost for compliance with the Transparency in Coverage and CAA regulations?

We realize these are significant legislative changes and expect there to be corresponding cost increases for employers. These cost adjustments will allow us to continue providing a high level of service you have come to expect from Pinnacle. We will communicate these adjustments as they become available.

Will Pinnacle be communicating these changes or updates?

We do anticipate communicating with employers as to our implementation activities for these laws. Employers may use these communications to develop communications for their employees.

What are the effective dates of the Laws?

The machine readable files required by TIC must be made public by July 1, 2022.

The CAA included numerous provisions, the majority of which become effective January 1, 2022; however, on August 20, 2021, delays in enforcement were announced for key provisions of the CAA. Specifically, enforcement of the price comparison tool mandate is delayed until January 1, 2023. The requirement for plans to provide a good faith estimate of charges and an Advance Explanation of Benefits (AEOB) when notified of a scheduled service by a provider are delayed, pending future regulatory guidance, with no final date set.

Implementation of the ID card, provider directory, gag clauses on price and quality data, and continuity of care requirements are required no later than January 1, 2022; however, implementation regulations are not expected prior to that date. As a result, plans are expected to implement based on a good faith, reasonable interpretation of the requirements by the January 1, 2022, compliance date.

How does the Transparency in Coverage regulation relate to the transparency requirements included in the “No Surprises Act” aka the Consolidated Appropriations Act (CAA) published at the end of 2020?

These two separate laws make sweeping changes to the health care industry in an effort to further promote transparency. Although separate, they include overlapping provisions, notably the price comparison tool requirements.

The CAA also includes other transparency initiatives beyond the Transparency in Coverage requirements including:

  1. Out-of-network providers to deliver to the patient’s health plan a “good faith effort of an estimated amount” of all billing and services;
  2. Providers to make available on their publicly available website information on their pricing for services;
  3. Health Plans to provide members with an Advanced Explanation of Benefits (AEOB) prior to scheduled care or upon patient request;
  4. Health Plans to maintain up to date provider directories; and,
  5. Health Plans to remove gag clauses in their par-provider contracts.


What is a machine-readable file?

A machine-readable file is a file of data or information that can be imported or read by a computer system for further processing without human intervention. We will post the data attributable to network and non-network claims, as well as PinnacleRx Solutions pharmacy information.

Will you build and manage the publicly accessible website with all required machine-readable files on behalf of your employer clients?

Pinnacle will make the required machine-readable files for in-network and out-of-network medical items and services public on HealthView as of the required deadline of July 1, 2022. These are the negotiated rates for in-network services and historical payments and billed charges from out-of-network providers. The third file, rates and historical prices for covered prescription drugs, has been deferred pending further regulation, and will be made available as required by federal law. . We will also be linking to our network partners’ files (Anthem Blue Cross, Blue Cross Blue Shield of Arizona, Blue Card, Multiplan, First Health), which are accessible through their websites.

When must the machine-readable files be available?

Implementation of two of the three machine-readable files – negotiated rates for in-network services and historical payments and billed charges from out-of-network providers – has been postponed to July 1, 2022. The third file, rates and historical prices for covered prescription drugs, has been postponed with no announced implementation date.

How often will the machine-readable files be updated?

The regulation outlines that the files are required to be updated monthly.


The Transparency in Coverage regulation requires health insurers and group health plans to make an internet-based self-service tool available to enrollees beginning on January 1, 2023 that contains personalized out-of-pocket cost information and the underlying negotiated rates for 500 covered health care items and services. Health plans must expand those tools to cover all items and services by January 1, 2024.

The CAA also requires plans to make available to members a price comparison tool to enable a member to compare the amount of cost-sharing the individual would be responsible for paying under the plan with respect to a specific item or service by a participating provider. Enforcement of the price comparison tool mandate has been delayed until January 1, 2023. The intent is to align the requirements of the Transparency in Pricing regulation with the Cost Price Comparison tool requirements of the CAA. Additional rulemaking guidance is anticipated.

Pinnacle is actively working on implementing the cost transparency tool for the Cedar plan by the January 1, 2023 deadline. This major technological implementation will enable our members to compare cost-sharing amounts for specific network providers in a specific region. Some of our network partners are also working on updating their tools. While we work to migrate all machine-readable data files to our cost transparency tool, members will be directed to these other network price comparison tools via HealthView.


The CAA requires plans to confirm provider directory information at least every 90 days, including removing providers or facilities who are non-responsive. Plans must also develop a response protocol to respond to member network questions. Members who rely on inaccurate information that a provider is in-network can only be liable for in-network cost-sharing.

Will a provider directory be available and kept up-to-date?

Yes. While regulations require plans to verify and update directories at least every 90 days, Pinnacle will verify and update these directories on a monthly basis.

Will a directory be available electronically? 
Yes, this will be available on our website: https://www.pinnacletpa.com/find-a-provider/.

Will you accept responsibility for directory inaccuracies resulting in added plan cost?

If a member provides documentation that he or she was provided inaccurate information from a plan or insurer about a provider’s network status prior to treatment, the plan will pay the relevant claims as if they were in-network.

How will access to the directory be provided (i.e., directly or via a plan sponsor website)?

The provider directory is/will be available through our website:



Included as part of the Consolidated Appropriations Act of 2021 (commonly referred to as the Consolidated Appropriations Act (CAA)) were several measures intended to strengthen parity in MH/SUD benefits, including a requirement that plans perform an analysis to demonstrate that Non-Quantitative Treatment Limitations (NQTLs) applied to MH/SUD benefits are comparable to and applied no more stringently than NQTLs applied to medical/surgical benefits. The analysis must be available upon request by the Departments.

Non-quantitative treatment limitations are behind-the-scenes administrative activities that take place but may impact coverage. Examples include credentialing, how plans determine the amounts to pay providers, utilization management, creation of medical policies and case management. The law requires that plans treat behavioral health conditions no less favorably than medical conditions.


The CAA requires health plans to provide an advance explanation of benefits (AEOB) for scheduled services at least three days in advance to give patients transparency into which providers are expected to provide treatment, the network status of those providers, good faith estimates of cost, cost-sharing and progress towards meeting deductibles and out-of-pocket maximums, as well as whether a service is subject to medical management and relevant disclaimers of estimates.

On August 20, 2021, the Departments announced an indefinite delay in enforcement of the AEOB requirements. No new enforcement date was set.

Pinnacle is currently working on developing the advanced explanation of benefits for scheduled services. The required date for implementation has been deferred by federal agencies pending further rulemaking. Once guidance is received, we will begin implementation of the solution.


The CAA includes the “No Surprises Act” which mandates that patients are only responsible for in- network cost-sharing amounts, including deductibles, in emergency situations and certain non- emergency situations where patients do not have the ability to choose an in-network provider (including air ambulance providers). The law also prohibits providers from balance billing except in limited circumstances with patient notice and consent. The act also requires an independent dispute resolution process for providers and plans who cannot reach an agreement on payment.

The Federal Independent Dispute Resolution (IDR) process was established to resolve disputes between payers and out-of-network providers only for services where balance billing is prohibited (i.e. when the No Surprises Act applies). Disputing parties must engage in a 30-business-day open negotiation period to attempt to reach an agreement regarding the total out-of-network rate (including any cost sharing). Once the open negotiation period has ended, either party can initiate the IDR process within 4 days. The IDR process will be administered by an arbitrator who will take into consideration payment amounts offered by each party as well as additional considerations (Qualified Payment Amounts, level of training and experience of the provider, etc.). The IDR arbitrator’s decision is binding and the losing party is responsible for paying the arbitrator’s fees (estimated to range from $200-$700), and both parties will pay a $50 administrative fee.

Much of the important detail of these provisions will be determined by regulations that will be released over the next several months. The information provided below incorporates the regulations that were issued on July 1, 2021 and September 30, 2021.

 Expansion of External Review

Plans are required to accommodate requests for external review when the applicability of surprise billing protections are in question.

Pinnacle has a written protocol to handle these appeals and requests. The member has the right to request review by an Independent Review Organization (IRO) after the appeal process if the applicability of surprise billing protections is in question. However, please note that Pinnacle will administer appeals in accordance with the applicable plan document. Employers should ensure that their SPDs are updated accordingly. Pinnacle can assist with your plan amendment and will suggest draft language that you may adopt.

Patient Deductible

Cost-sharing payments made with respect to non-network emergency services or non-emergency services performed by non-par providers in par facilities will be counted toward the member’s network deductible and out-of-pocket maximum in the same manner as if the services were provided by a network provider. The same applies for air ambulance services. If a member relies on an incorrect provider directory and receives services from a provider that is no longer in the network, any payments made will be counted toward the member’s network deductible and out-of-pocket maximum. Pinnacle has updated its internal claims processes to remain in compliance with this requirement and, effective January 1, 2022, out-of-network surprise bills are applied to the member’s network deductible.

Claims Adjudication

Plans are required to make the initial payment or denial of claims within 30 days of receipt of the claim. Pinnacle has and will continue to pay or deny claims within 30 days of receipt.

Disclosure of Balance Billing Rules

Prohibition on balance billing language is required to be posted on the plan’s public website and on each EOB. Pinnacle has added this language to its website, and we are currently working on adding this language to every EOB. Additionally, our legal team is working on consolidating the EOB language, as well as using electronic delivery for the full disclosure.

Will you assist clients in negotiations with out-of-network (OON) providers prior to the start of arbitration?

If Pinnacle is handling the IDR process, we will negotiate with OON providers. However, the group will be charged any fees related to IDR.

How does the IDR process work with regard to surprise billing and out-of-network providers?

Providers and health plans will have a 30-day resolution period to settle out-of-network claims, beginning on the date the provider receives the plan’s initial payment or notice of denial. If no agreement is reached, either party may initiate independent dispute resolution (IDR) within four days of the end of the resolution period. The IDR entity will consider several factors, including the median in-network rate (known as the Qualifying Payment Amount, or QPA), the provider’s training and experience, patient acuity, complexity of service, facility status, and prior contracted rates. The IDR entity will make a binding determination within 30 days.

How is the QPA determined?

The QPA will be determined in accordance with a methodology established by the Department of Health and Human Services (HHS). To date, this methodology has not been released by HHS.

What can the client expect in regard to IDR fees and expenses?

According to the Surprise Billing interim final rule issued on September 30, 2021, the following are the ranges of fees that can be expected – see https://www.cms.gov/CCIIO/Resources/Regulations-and- Guidance/Downloads/Technical-Guidance-CY2022-Fee-Guidance-Federal-Independent-Dispute- Resolution-Process-NSA.pdf

  • For the calendar year beginning January 1, 2022, the administrative fee due from each party for participating in the Federal IDR process is $50. In future years, estimated costs will be informed by the actual costs incurred by the Departments to carry out the Federal IDR process.
  • The average the certified IDR entity fee will be approximately $400.
  • For the calendar year beginning January 1, 2022, certified IDR entities must charge a fixed certified IDR entity fee for single determinations within the range of $200-$500, unless otherwise approved by the Departments pursuant to section IV of this guidance.
  • If a certified IDR entity chooses to charge a different fixed certified IDR entity fee for batched determinations, that fee must be within the range of $268-$670, unless otherwise approved by the Departments pursuant to section IV of this guidance.
  • Under no circumstances may a certified IDR entity charge a party for additional costs beyond the certified IDR entity fee and administrative fee.


The CAA requires health plans to provide information on ID cards regarding the amount of the in- network and out-of-network deductibles, the in-network and out-of-network out-of-pocket maximum limitations, and a telephone number and Internet website address through which individuals may seek consumer assistance information.

When will new ID cards be issued?

The CAA requires that new ID cards be made available to participants at renewal, on or after 1/1/2022. Pinnacle has taken this opportunity to make a number of changes to improve the format of its cards. Our new card design features a more streamlined look for easier readability for both members and providers. Pinnacle has worked to ensure that all ID cards, with the exception of those that have a different pharmacy benefit manager (PBM), have already been distributed to members.


The CAA prohibits so-called “gag clauses” in health plan participating provider contracts. These contract provisions prohibit payers from disclosing provider-specific cost or quality information.

Will this prohibition require an amendment to our contract with Pinnacle?

Pinnacle’s standard provider contract language include a provision stating that the parties will comply with applicable law. To remain in compliance and improve transparency, Pinnacle has omitted gag clauses from new contracts and will continue to remove gag clauses from existing contracts as they are renewed. Although this provision became effective December 20, 2020, legislation is still pending on when and how plans are required to submit their plan attestation that the plan is   in compliance. Pinnacle will adhere to these provisions when these guidelines are finalized.


The CAA requires health plans to provide in-network coverage for 90 days of continued care to members whose provider or facility leaves the health plan’s network when the member is undergoing treatment for a serious and complex condition, pregnant, receiving inpatient care, scheduled for non-elective surgery, or terminally ill.

Describe how you will implement the requirement to allow continuation of care for individuals when their health care provider is terminated from the Network, under ERISA Section 718 and PHSA Section 2799A-3.

Please note; however, that Pinnacle will administer your plan in accordance with your plan document. You should ensure that your SPD is amended to reflect this requirement. Pinnacle can assist with your plan amendment and will suggest draft language that you may adopt.


The Administrative Services Agreement will be amended to reflect the changes to the services Pinnacle provides as of January 1, 2022. The actual amendment to the Administrative Services Agreement, will be provided at renewal on or after January 1, 2022.


Will we need to update our SPDs to reflect the changes in the new legislation?

Some, but not all, of the new provisions will result in changes to SPDs. For example, your plan may require an amendment to include information about surprise bills, as well as the expansion of the external review process to include surprise billing issues.

Contact your Account Manager if you have questions about whether your SPD should be amended. Please keep in mind that SPDs must be distributed to participants every five years (ten years if there have been no changes); if your SPD is not current, it may be time to restate it.

**The information in this document does not constitute legal advice. Customers should consult their legal team for further questions or advice.**



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