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Federal Register / Vol. 86, No. 177 / Thursday, September 16, 2021 / Proposed Rules applicable to non-Federal governmental plans in all states, and issuers, providers, and facilities, including providers of air ambulance services, in states where HHS is directly enforcing PHS Act requirements or in states that are not substantially enforcing the requirements. Furthermore, these provisions detail the process by which CMS would impose civil money penalties against providers and facilities, including providers of air ambulance services, for a violation of an applicable PHS Act provision or for failure to submit required data in compliance with section 106a of the No Surprises Act.
Affected entities, such as plans or third-party administrators on behalf of self-insured group health plans, health insurance issuers, FEHB carriers, issuers of short-term, limited-duration
insurance, providers, including providers of air ambulance services, and facilities would incur costs related to the submission of data on air ambulance services, disclosure and reporting of agent and broker compensation, and enforcement actions. In accordance with Executive Order 12866, the Departments are of the view that the benefits of this regulatory action justify the costs.
C. Impact Estimates and Accounting Table The provisions in these proposed rules would ensure that plans, issuers, providers including providers of air ambulance services, and facilities subject to HHSs enforcement authority comply with requirements in the No Surprises Act and that participants, beneficiaries and enrollees with health care coverage are protected from
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surprise medical bills. In addition, having access to information related to agent and broker compensation increases transparency and could help enrollees with individual health insurance coverage and short-term, limited-duration insurance coverage make more informed decisions regarding their health care coverage. In accordance with OMB Circular A4, Table 8 depicts an accounting statement summarizing the Departments assessment of the benefits and costs associated with this regulatory action.
The Departments are unable to quantify the benefits of these proposed rules, but have included a qualitative discussion.
The effects in Table 8 reflect qualitative impacts and estimated direct monetary costs resulting from the provisions of these proposed rules.

TABLE 8ACCOUNTING TABLE
Benefits and Intended Outcomes:
Qualitative:
Increased transparency related to agent and broker compensation arrangements and structures, giving consumers more information as they make choices regarding health care coverage.
Ability for the Federal Government to analyze and/or investigate potential unfair or deceptive practices against consumers, and unfair methods of competition used by providers of air ambulance services.
Improved compliance with laws prohibiting surprise medical bills due to enforcement actions.
Costs:

Estimate million
Annualized Monetized $/year

Year dollar
$31.82
32.35

2021
2021

Discount rate %
7 3

Period covered 20212025
20212025

Quantitative:
Costs to issuers of individual health insurance coverage and short-term, limited-duration insurance to provide proposed agent and broker compensation disclosures prior to when an individual finalizes their plan selection, and on any documentation confirming initial enrollment, including enrollment documentation required by applicable state or Federal law or an initial enrollment package estimated to be approximately $11.1 million annually beginning in 2022.
Costs to agents and brokers for providing compensation disclosures prior to when an individual finalizes their plan selection, estimated to be approximately $1.8 million annually beginning in 2022.
Costs to issuers of individual health insurance coverage and short-term, limited-duration insurance to gather and submit proposed agent and broker compensation data to HHS, expected to be approximately $5.7 million annually beginning in 2023.
Costs to plans, issuers, FEHB Carriers, and TPAs to submit proposed air ambulance related information to HHS, estimated to be onetime costs of approximately $3.6 million in 2022 and annual costs of approximately $829,241 in 2023 and 2024.
Costs to providers of air ambulance services to submit proposed information to HHS, estimated to be one-time costs of approximately $3
million in 2022 and annual costs of approximately $134,538 in 2023 and 2024.
Costs to providers and facilities, including providers of air ambulance services, related to enforcement actions, estimated to be approximately $850,320 annually, starting in 2022.
Costs to the Federal Government to implement the proposed reporting requirements and enforcement activities, estimated to be $4 million in 2021, $20.3 million in 2022, $22.2 million in 2023, $18.3 million in 2024 and $18.4 million in 2025.
Quantitative:
Potential reduction in income for agents and brokers and potential costs and reduction in revenue and profits for providers of air ambulance services, if there are changes in consumer behavior and operational changes as a result of greater transparency regarding agent and broker compensation and the air ambulance industry.

1. Background a. Agent and Broker Compensation The issue of increasing transparency within the health insurance industry regarding agent and broker compensation has drawn escalating attention in recent years. Part of the
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increased need for transparency stems from the expanded availability of shortterm, limited-duration insurance coverage.43 Insurance agents or brokers
often receive higher commission rates for enrolling consumers in short-term, limited-duration insurance coverage compared to coverage that meets ACA

43 Department of the Treasury, Department of Labor, Department of Health and Human Services, Short-Term, Limited-Duration Insurance, 83 FR
38212 Aug. 3, 2018 www.govinfo.gov/content/

pkg/FR-2018-08-03/pdf/2018-16568.pdf final rule.

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