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Payers may not have to cover all COVID-19 testing

Ingrid Stiver Senior Manager, Health Research Institute, PwC US July 16, 2020

Health plans are not required to pay for SARS-CoV-2 testing conducted for purposes other than the diagnosis of COVID-19 after evaluation by a healthcare provider, according to an FAQ issued by HHS, the Department of Labor (DOL) and the Department of the Treasury in late June. The Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief and Economic Security Act (CARES Act) require health plans to pay in full for testing for detection of SARS-CoV-2, the virus that causes COVID-19, or the diagnosis of COVID-19.


Under the clarified guidance in the June FAQ, employers, not health plans, would be responsible for the cost of testing done primarily for returning employees to work safely. State and local governments would be responsible for the cost of testing conducted for public health purposes. This could include testing conducted by state and local governments in order to restart in-person learning this fall.


Congressional Democrats pushed back on the June FAQ, sending a letter last week to HHS Secretary Alex Azar, Labor Secretary Eugene Scalia and Treasury Secretary Steven Mnuchin asking that all health plans be required to pay for all COVID-19 testing without cost sharing.


As of July 15, major payer trade associations had remained publicly silent on the clarification in the June FAQs.

HRI impact analysis

Testing remains a key component of many public health strategies aimed at stopping the spread of the virus and reopening the economy. The FAQs make it clear that employers with self-funded health plans have to pay for testing for purposes of individual diagnosis of COVID-19


Additionally, employers may have to pay directly for testing related to returning employees to work, rather than paying for it through the employee medical plan. Employers could see some added costs if they have to separately contract for return-to-work testing, and they may not be able to secure as favorable rates as a health plan could.


Some employers are opting not to pursue routine testing as part of their return-to-work strategy, listing reasons such as cost concerns and a false sense of security when someone tests negative.


Routine testing could be an essential strategy for schools considering a return to in-person learning in the fall, although CDC recommendations do not call for universal testing for schools. Under the clarified guidance in the June FAQ, health insurers would not be required to pay for this testing. School districts considering routine testing will have to consider how to fund these activities, something that could put further strain on already-strapped school, local and state government budgets.  

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Trine K. Tsouderos

HRI Regulatory Center Leader, PwC US

Tel: +1 (312) 241 3824

Ingrid Stiver

Senior Manager, Health Research Institute, PwC US

Erin McCallister

Senior Manager, Health Research Institute, PwC US

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