Each year by December 31st, group health plans must attest that their agreements with healthcare providers, networks/associations of healthcare providers, third party administers (TPA), or other service providers do not contain any prohibited gag clauses. For more information on the gag clause prohibition compliance attestation and how to complete the attestation please see this article. Employers/Plan Sponsors are encouraged to work with their insurance carrier or TPA to determine submission responsibilities.
In early 2025, regulators released additional guidance regarding the gag clause prohibition compliance attestation which plan sponsors may want to familiarize themselves with prior to making their 2025 attestation.
Additional Gag Clause Prohibition Compliance Attestation Guidance
On January 14, 2025, the Departments of Labor, Health and Human Services, and the Treasury (“The Departments”) released “FAQS About Consolidated Appropriations Act, 2021 Implementation Part 69” addressing how the gag clause prohibition applies in certain circumstances. Plan sponsors may be well served to review this guidance should they have questions about completing the gag clause prohibition compliance attestation.
Downstream Agreements
Plan sponsors may enter into agreements with TPAs or other service providers that have entered into their own separate agreements with other entities to provide or administer a plan’s network. These separate agreements between the TPA/service provider and other entities are referred to as “downstream agreements.”
The Departments take the position that if these downstream agreements restrict a TPA or service provider from sharing information with the plan sponsor, they could violate the prohibition on gag clauses by indirectly preventing plan sponsors from obtaining information they otherwise could.
Discretionary Disclosures
Some agreements with TPAs or service providers leave the disclosure of information at the discretion of the TPA or service provider. The Departments indicate disclosures that are only permitted at the discretion of the TPA or service provider would be an example of an impermissible gag clause.
Restrictions on Access to Information
TPAs and service providers will occasionally place limitations on the scope, scale, or frequency of electronic access to information. The Departments take the position that if these limitations place unreasonable limits on the ability of the plan to access the information “upon request” they would be prohibited gag clauses.
What If You Find a Gag Clause
In past years, it was unclear how to complete the attestation if you uncovered a prohibited gag clause in an agreement. The Departments indicate that information about agreements containing prohibited gag clauses should be provided in the attestation process if the provision cannot be removed from an agreement. However, gag clauses are prohibited, and the Departments indicate that enforcement action based on the existence of a gag clause is possible. The Departments state they will consider good-faith efforts to self-report prohibited gag clauses but, in absence of enforcement relief, plan sponsors may want to work with counsel to determine if self-reporting any prohibited gag clauses makes sense for them.
Key Takeaways
Plan sponsors would be well served to work with either their insurance carrier or TPA to ensure the required gag clause prohibition attestation is being submitted. Plan sponsors may also want to review the FAQs regarding the gag clause compliance attestation in case they run into a situation discussed in the FAQs.
The information provided is a summary of laws and regulations relating to employee benefit plan compliance. This information should not be construed as legal advice. In all cases, employers should consult with their own legal counsel.
