Plans Must Cover OTC, At-Home COVID Tests

In early January, the Departments of Health and Human Services (HHS), Labor, and Treasury issued guidelines on mandatory coverage of over-the-counter, at-home COVID-19 tests.

The guidance states that plans are required to cover FDA-authorized OTC COVID tests, which are tests without either a prescription or individualized clinical assessment by a health care provide, purchased between January 15, 2022, through the end of the public health emergency. Plans must cover eight tests per covered person per month these without any cost-sharing to the participant. Plans are not required to cover COVID tests used for employment purposes or non-personal use. This new requirement does not affect the existing requirement that plans must cover COVID tests that are ordered or administered by a provider.

The guidance describes two ways for participants to obtain a test. First, they may pay upfront for a test from any pharmacy, retail location, or online retailer and then submit a claim for reimbursement. Second, plans may elect to contract with certain pharmacies/retailers to provide “direct coverage” of the tests, where the plan will pay a preferred pharmacy directly for the test and the participant pays nothing upfront or out-of-pocket. The plan must also offer a direct-to-consumer shipping option. If a plan sets up this direct coverage program, it can cap reimbursement of any tests purchased outside of the preferred pharmacy network at $12 per test. A direct coverage program is not mandatory, but a plan cannot cap the amount reimbursed unless there is a direct coverage option.

This guidance follows an announcement by President Biden in early December that outlined steps the federal government would take to fight the COVID-19 pandemic, especially considering the new omicron variant.