The gag clause prohibition provisions of the Consolidated Appropriations Act, 2021 (CAA 2021) took effect on December 27, 2020. These provisions prohibit group health plans and insurers from entering agreements containing certain types of gag clauses. In the healthcare context, a “gag clause” refers to a contract term that directly or indirectly restricts information that a group health plan or insurer can make available to another party. Additionally, the CAA 2021 requires plans and insurers to attest to compliance with the gag clause prohibition annually by each December 31.
Like other CAA 2021 provisions, the DOL, HHS, and IRS (the departments) did not immediately issue implementation guidance regarding the gag clause prohibition. Rather, plans and insurers were initially expected to comply with the requirements using a good faith, reasonable interpretation of the CAA 2021.
On February 23, 2023, the departments released guidance in the form of FAQs to explain the law and promote compliance. The FAQs also provided instructions for plans and insurers to submit their attestations of compliance with the gag clause prohibition. Accordingly, employers, as plan sponsors, must ensure their applicable contracts do not contain any prohibited gag clauses and must timely attest to compliance. The first attestation of compliance was due by December 31, 2023, attesting to compliance for contracts entered into from December 27, 2020, through the date of the first attestation. Subsequent attestations are due annually thereafter by each December 31. Although the annual attestation must be submitted by December 31, attestations may be made at any time during the calendar year. Each attestation covers the period from the date of the last attestation through the date of the subsequent attestation.
Given the legal implications of any contract or attestation, employers should generally consult with legal counsel for guidance regarding their specific contracts and related CAA 2021 compliance obligations.
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