FAQ Part 52: Coverage of Over-the Counter COVID-19 Tests

The Departments of Labor, Health and Human Services (HHS), and the Treasury (collectively, the Departments) have issued their FAQ 52 clarifying certain requirements regarding the obligation of health plans and health insurance issuers (Plans) to cover at-home COVID-19 tests. Under legislation passed in 2020, Plans are required to cover such tests without cost-sharing, prior authorization, or medical management requirements.

In their FAQ 51, the Departments clarified that the obligation to cover such tests applies to over-the-counter (OTC) tests available to consumers without a prescription or individualized clinical assessment.  FAQ 51 established two safe harbors for the implementation of this requirement.

• First, Plans can arrange for direct coverage of OTC COVID-19 tests through both its pharmacy network and a direct-to-consumer shipping program.  Plans would have to pay for tests obtained from other sources but could limit reimbursements to the lesser of the actual price or $12 (including applicable shipping and sales taxes).  Participants cannot be required to pay for tests upfront and seek reimbursement from the Plan.  Rather, Plans would need to make whatever adjustments might be needed to process claims directly from the sellers.
• Second, Plans can limit reimbursement to 8 tests for a 30-day period (or per calendar month).

FAQ 52 was issued to clarify various questions that had arisen about the safe harbors in FAQ 51.

Plans can meet the requirement to provide “direct coverage” of COVID-19 tests if they offer at least one direct-to-consumer shipping mechanism and one in-person mechanism.  Examples given in the FAQ include:

• direct-to-consumer shipping programs that allow for orders to be placed online or by telephone;
• the Plan’s pharmacy network;
• other non-pharmacy retailers (including through distribution of coupons for enrollees to receive tests from certain retailers without cost-sharing); and
• alternative OTC COVID-19 test distribution sites established by, or on behalf of, the Plan (such as a standalone drive-through or walk-up distribution site, including a site that operates independently of a pharmacy or other retailer).

The in-person program can limit reimbursement to specified outlets or tests but should ensure that an adequate number of locations and tests are available.  Program adequacy will be determined under a “fact-and-circumstances” standard.  The Department will consider matters such as the locality of Plan participants; current utilization of the Plan’s pharmacy network by its participants, when making such coverage available through a pharmacy network; and how the Plan notifies participants of the retail locations, distribution sites, or other mechanisms for distributing tests, as well as which tests are available under the direct coverage program.

Plans should ensure that participants have all the information they need to secure the tests.

Plans will not be considered out-of-compliance solely because they are unable to meet demand for the test due to supply shortages.

Although Plans cannot limit access to the test through medical management processes, they can take steps to prevent, detect, and address fraud and abuse.  For example, a Plan could:

• disallow reimbursement for tests that are purchased by a participant from a private individual via an in-person or online person-to-person sale, or from a seller that uses an online auction or resale marketplace;
• require reasonable documentation of proof of purchase that clearly identifies the product and seller, such as a UPC code or other serial number, original receipt from the seller of the test, or other documentation for the OTC COVID-19 test to verify that the item qualifies for coverage;
• require a participant to attest that the test had not been (and will not be) reimbursed by another source.

However, the FAQ also reminds Plans that they cannot require participants to submit multiple documents or jump through numerous hoops that unduly delay access to or reimbursement for the tests.

The FAQ cautions that the rules regarding coverage of OTC tests are limited to those tests that can be used by and provide results to the consumer without the involvement of a laboratory or health care provider.

Finally, the FAQ explains that participants cannot be reimbursed by an FSA, HRA, or HSA for tests to the extent they are paid for or reimbursed by the Plan.