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Federal Guidance on Insurance Coverage for COVID-19 Tests

COVID-19, Employee Benefits

On January 10, 2022, the Department of Labor, Health and Human Services and the Treasury issued an FAQ regarding provisions of the Families First Coronavirus Response Act (FFCRA), the Coronavirus Aid, Relief and Economic Security Act (CARES) and the Affordable Care Act (ACA). Specifically, this FAQ addresses insurance coverage for COVID-19 tests and preventive services.

OTC COVID-19 Tests

This guidance requires reimbursement by a health plan or issuer for over-the-counter (OTC) COVID-19 diagnostic tests without an order or individualized assessment by a health care provider. Coverage for these tests must be provided without cost-sharing, prior authorization or other medical management requirements. Health plans are not required to reimburse the sellers of the tests, but rather must allow for participants, beneficiaries and enrollees to submit a claim for reimbursement to the plan or issuer. However, plans and issuers are strongly encouraged to provide direct coverage for the tests without involving upfront payment by participants, beneficiaries and enrollees.

It is important to note that this guidance does NOT require coverage for OTC COVID-19 tests purchased for employment purposes.

Plans may not limit coverage to tests provided by preferred pharmacies or retailers. Plans may, however, limit coverage to the applicable pharmacy network of the plan and a direct-to-customer shipping program and may cap the reimbursable price to $12 per test or the actual price of the test, whichever is lower. Plans and issuers may voluntarily decide to reimburse up to the actual price of the test. Plans must provide adequate access to the tests. 

Plans may set limits on the number or frequency of the covered OTC COVID-19 tests to no less than eight tests per 30 day period for each participant, beneficiary or enrollee. This limit cannot be changed to a limit for a shorter period of time (for instance four tests over a 15 day period). Plans and issuers are allowed to implement safeguards to limit fraud and abuse, such as an attestation or documentation requirement.

Plans and issuers may provide educational information on the access and use of OTC COVID-19 tests as long as the information is clear regarding coverage of tests.

Coverage as required by this guidance is effective for purchases made on or after January 15, 2022.

Preventive Services

This guidance also requires plans and issuers to provide coverage without cost-sharing for follow-up colonoscopies conducted after a positive non-invasive stool-based screening test or other direct visualization test. This coverage must be provided for plan or policy years beginning on or after May 31, 2022 (starting with June 1, 2022 plan years).

In addition, the guidance reinforces the requirements related to contraceptive coverage and reminds plans and issuers that such coverage must be provided for any service or FDA-approved, cleared or granted contraceptive product that is medically appropriate for any individual.

Key Takeaways

Employers should partner with their health insurance carrier or third party administrator (TPA) to implement the required coverage in a way that best fits organizational goals. There is some flexibility in the way that coverage can be implemented, so organizations would be well-served to discuss the implementation with their carrier or TPA as part of the implementation process.

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