Beginning January 15, the Biden administration published advice requiring private health insurance to cover patients for up to eight over-the-counter Covid-19 tests.
Private insurance may set up programs at selected pharmacies or shops where the initial cost of home testing is paid for by beneficiaries under the plan. Every month, a family of four might have 32 home tests reimbursed by their health insurance.
According to guidance issued by the Departments of Health and Human Services, Labor, and Treasury, “plans and issuers are strongly encouraged to provide direct coverage for OTC Covid-19 tests to respondents, beneficiaries, and enrollees by compensating sellers directly without involving participants, beneficiaries, or enrollees to provide upfront payment and seek reimbursement.”
The program aims to reduce the cost burden of using at-home testing to identify and prevent the spread of Covid-19. According to CDC statistics, the more-transmissible Omicron version of the virus is responsible for more than 668,000 infections every day.
However, public health experts caution that this figure is vastly undercounted, in part because the results of millions of at-home tests are not submitted to state and local health authorities.
“By forcing private health plans to cover people’s at-home testing, we are extending Americans’ ability to access tests for free when they need them,” said HHS Secretary Xavier Becerra in a statement.
Individuals who buy home tests outside of their insurer’s preferred network must be paid up to $12 per test, but the guideline states that plans may “offer more generous reimbursement up to the actual price of” more expensive tests. Still, this might cause issues for customers who live far from participating pharmacies or who buy more expensive home tests, such as Detect’s at-home molecular test, which costs $75 for the test and the reusable hub.
“We hope that insurance companies realize the advantage of paying the entire cost of molecular home testing since improved access to these tests may help an individual to obtain treatment sooner — which ultimately decreases overall health care expenditures,” said Detect spokesman Shawna Marino.
According to Michael Bagel, director of public policy at the Alliance of Community Health Plans, insurers will not have enough negotiating power in the near future due to the Omicron wave driving overwhelming demand for at-home tests combined with the government’s plan to purchase 500 million of the rapid tests.
“This is an unfunded demand imposed on insurers and customers,” Bagel said. “There are just impediments to getting it up and running in time.” We have 96 hours to put up a preferred pharmaceutical list and have the operational components in place.”
While there would “certainly be some difficulties” in adopting the new instructions, America’s Health Insurance Plans CEO Matt Eyles said insurers would cooperate with the Biden administration to resolve concerns as they arise.
“We acknowledge that the administration’s advice takes efforts to avoid the genuine dangers of price gouging, fraud, and abuse, which would restrict access and diminish affordability for everybody,” Eyles said in a statement.
According to Bagel, another problem for insurers will be monitoring the number of tests consumers purchase from various sites. If a physician prescribes an at-home test for a patient, it does not count against the monthly maximum of eight tests.
People on Medicare and those without health insurance are exempt from the new restrictions controlling compensation for at-home diagnostics. According to HHS, state Medicaid programs and the Children’s Health Insurance Program are already required to pay for at-home exams.
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