From fostering a workplace culture centered on supporting the physical, emotional, career and financial wellbeing of employees to ensuring benefit programs are compliant with local, state, and federal requirements, effectively protecting the wellbeing of your employees connects directly to protecting the wellbeing of your organization overall.

Compliance Connections delivers actionable guidance designed to help you manage and optimize the connections between the compliance of your benefits and human resources programs to overall organizational wellbeing. This edition focuses on compliance issues that are likely to impact employer-sponsored health and welfare benefits in the year ahead.

Below, we explore five items to add to your 2022 Compliance To-Do List.

  1. Meet new transparency requirements. New transparency requirements are likely at the top of every employer's compliance list for 2022. Such requirements range from identification cards to continuity of care to provider directories. New disclosure and reporting requirements will also launch in 2022. As early as July, non-grandfathered health plans (and health insurers) will be required to make certain healthcare cost data publically available in machine-readable files. The data must be provided in two files — an "In-Network Rate File" and an "Allowed Amount File." The first file must show negotiated rates for all covered items and services between the plan (or insurer) and in-network providers. The second file must show both the historical payments to, and billed charges from, out-of-network providers. In December, plans will be required to report certain information about prescription drug and health care spending, including specific information about the 50 most frequently dispensed brand prescription drugs; the 50 costliest prescription drugs by total annual spending; and the 50 prescription drugs with the greatest increase in plan or coverage expenditures from the previous year. What impediments must your plan remove in order to comply with new transparency requirements?
  1. Anticipate questions related to surprise billing. The No Surprises Act (NSA) provides protections against surprise medical bills in specified circumstances. Surprise medical bills can occur when a patient unexpectedly receives out-of-network health care from a provider, facility, or provider of air ambulance services that do not participate in the network of the individual's group health plan or group or individual health insurance coverage. Under the NSA, the provider, facility, or provider of air ambulance services generally can no longer balance bill a patient for the excess amount arising when the individual's coverage does not pay for the difference between the individual's cost sharing amount and the billed amount, and patient cost sharing is limited to in-network levels. In the absence of an All-Payer Model Agreement or specified state law, a patient's cost-sharing amount is based on a qualified payment amount (QPA). The QPA also plays a role in the federal independent dispute resolution (IDR) process when the parties are unable to agree upon the appropriate amount payable. Thus, employees and their family members may have questions when they encounter out-of-network claims based upon QPAs and may turn to human resources and benefits professionals for answers. What additional information should you be prepared to share with employees and their family members about new surprise billing protections?

  2. Prepare NQTL Comparative Analysis Reports. Over the past several years, federal agencies have released several sets of FAQs, a disclosure request template, and other compliance materials on the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). Much of this recent guidance relates to the 21st Century Cures Act, which requires federal agencies to issue MHPAEA guidance and step up parity enforcement for no quantitative treatment limitations (NQTLs). The Consolidated Appropriations Act, 2021 (CAA) amended the MHPAEA to provide new protections. More specifically, the CAA requires group health plans that offer both medical/surgical benefits and mental health/substance use disorder (MH/SUD) benefits and that impose NQTLs on MH/SUD benefits to perform and document their comparative analyses of the design and application of NQTLs. In addition, those comparative analyses must be made available not only to applicable requesting federal or state agencies but also to participants and beneficiaries (or their authorized representatives) in ERISA-covered plans in order to meet requirements to provide comparative information on medical necessity criteria for both medical/surgical benefits and MH/SUD benefits, as well as the processes, strategies, evidentiary standards, and other factors used to apply an NQTL with respect to medical/surgical benefits and MH/SUD benefits under those plans. Applicable federal agencies have increasingly focused on mental health parity during their compliance processes. In fact, the Department of Labor (DOL) reportedly took the step to require that any plan under audit at the time the initial comparative analysis reporting requirement became effective in February 2021 would be required to produce its NQTL comparative analysis report. Given the increasing focus on mental health parity enforcement, what actions should your plan take to ensure that it can provide applicable comparative analysis reports?

  3. Review wellness incentives. The Equal Employment Opportunity Commission (EEOC) issued wellness regulations in 2016 that included rules for incentives (rewards or penalties) permitted under the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA). HIPAA rules governing incentives were already in place. In response to a December 2017 court order, the EEOC removed the incentive provisions from its regulations effective January 2019. Since the EEOC did not issue any new guidance, plans were left with no concrete rules to use to determine what, if any, incentive would satisfy the previous vague requirement that the incentive "must not be coercive." In January 2021, the EEOC issued proposed regulations that included guidance on permissible incentives but shortly thereafter withdrew those proposed regulations leaving employers with the same problem — how to determine if an incentive is permissible. The only guidance provided since then — rules for incentives related to COVID-19 vaccinations — does not give employers guidance on incentives for anything other than COVID-19 vaccinations. Although the EEOC has not given any hints about when wellness incentive guidance might be issued, we can always hope that it will be sometime in 2022. Which of your wellness incentives will be subject to additional guidance from the EEOC?

  4. Revise HIPAA Privacy and Security policies and procedures. The Department of Health and Human Services (HHS) has been working on additional guidance for the HIPAA Privacy, Security, and Breach Notification requirements for several years. They issued a request for information in December 2018 and provided proposed regulations in December 2020. The comment period for these proposed regulations closed on May 6, 2021. Although much of the proposed regulations focus on healthcare providers, some of the proposed changes, such as a substantial decrease in the amount of time a covered entity would have to respond to an individual's request for access to protected health information, will affect group health plans. Many hope that HHS will issue guidance sometime in 2022. What updates will be needed in your written HIPAA Privacy and Security policies and procedures when new regulations are finalized?

This is a preview edition of Compliance Connections, a monthly publication produced by Gallagher's Compliance Consulting Practice. For five more action steps, contact your Gallagher representative or visit our Compliance Resources page to subscribe and receive the full version of this publication each month.


Compliance is a series of actions, not a final destination. As a trusted advisor, Gallagher has developed this Compliance Connections series to help you pursue a path through employee benefits compliance issues as part of an overall continuing compliance plan. Plan sponsors should carefully evaluate their health and welfare plans to determine if they are in compliance with both federal and state law. If you have any questions about one or more of the compliance requirements listed above, or would like additional information on how Gallagher constantly monitors laws and regulations impacting employee benefits in order to support plan sponsors in their compliance efforts, please contact your Gallagher representative.


The intent of this analysis is to provide you with general information. It does not necessarily fully address all your organization's specific issues. It should not be construed as, nor is it intended to provide, legal advice. Questions regarding specific issues should be addressed by your organization's general counsel or an attorney who specializes in this practice area.