Prescription Drug Data Collection (RxDC) reporting remains a key federal compliance requirement for employer-sponsored health plans. As part of broader transparency efforts under the Consolidated Appropriations Act, 2021 (CAA), employers must ensure that detailed information about prescription drug costs and overall healthcare spending is submitted annually to federal regulators.
For the 2025 reference year, reports are due no later than June 1, 2026, and no extensions are available. Many carriers and TPAs require employer input well before the federal deadline to allow vendors time to compile and submit the full report.
What Is RxDC Reporting?
RxDC reporting is a federal data submission requirement designed to improve transparency in prescription drug pricing and healthcare costs. It requires group health plans and insurers to report a wide range of financial and utilization data to the Centers for Medicare & Medicaid Services (CMS). Federal agencies use this information to better understand cost drivers, trends in drug pricing, and the impact of rebates and fees on employer plans and participant costs.
RxDC reporting can also offer employers insight into plan spending trends, particularly for prescription drugs, to help guide future plan design, cost management strategies, and vendor negotiations.
RxDC reporting continues to be a significant annual compliance requirement with operational and strategic implications. Employers that take a proactive and coordinated approach will be better positioned to meet deadlines, reduce risk, and gain value from the data being reported.
Who Must Comply
RxDC reporting applies broadly across employer-sponsored health coverage and includes fully insured, self-funded, and level-funded group health plans of all sizes.
Certain excepted benefits (like standalone dental or vision, and most EAPs or HSAs) are not subject to RxDC reporting.
Even when reporting responsibilities are delegated to vendors, the legal obligation ultimately remains with the plan sponsor, particularly for self-insured arrangements.
What Data Must Be Reported
Plans, issuers, and carriers must submit plan (P) and drug (D) data, along with a narrative response. Together, these provide a comprehensive view of plan costs and prescription drug utilization.
Plan-level information includes:
- Plan name and identifying information
- Enrollment and participant counts
- Average monthly premiums paid by employers and employees
Drug and cost data includes:
- Total healthcare and prescription drug spending
- The most frequently used prescription drugs
- The most costly drugs
- Drugs with the greatest increase in spending
- Manufacturer rebates and fee arrangements
The narrative response describes the impact of prescription drug rebates on premium and cost sharing.
These data elements allow regulators to analyze how prescription drugs contribute to overall healthcare costs and premium increases.
Completing the RxDC report requires coordination across multiple parties:
- Insurance carriers or TPAs provide claims and spending data.
- Pharmacy Benefit Managers (PBMs) supply drug pricing, rebate, and utilization information.
- Employers contribute plan-level details such as premium contributions and enrollment data.
Because no single entity holds all required data, successful reporting depends on collaboration and timely information sharing.
Employer Responsibilities: More Than a “Hands-Off” Requirement
Although many employers rely on carriers, TPAs, or PBMs to submit RxDC reports, employers still play an active role in the process.
For fully insured plans, the insurance carrier typically handles the filing. However, employers are often required to:
- Review and confirm plan information
- Provide contribution and enrollment data
- Respond to carrier-issued surveys or questionnaires
For self-insured plans, the employer is technically responsible for the filing but may delegate the task to a vendor through a written agreement.
Even in these cases, the employer retains compliance liability if reporting is incomplete or inaccurate.
Penalties and Compliance Risk
Failure to comply with RxDC reporting requirements may trigger penalties under the Internal Revenue Code §4980D of $100 per day per affected individual.
Beyond financial penalties, incomplete or inaccurate reporting may also raises fiduciary concerns, particularly for self-insured plan sponsors.
Employer Action Items
- Confirm early in the year who is responsible for submitting the RxDC report. This includes reviewing agreements with carriers, TPAs, and PBMs to ensure responsibilities are clearly defined.
- Watch for data requests in advance of the June 1 deadline and respond promptly to avoid delays or incomplete filings.
- Confirm what data each vendor will provide and what information the employer must supply. Written confirmation of filing responsibility is the best practice.
- Understand that delegating reporting does not eliminate liability. Inaccurate or incomplete filings can result in penalties and potential fiduciary exposure.