How Does COVID-19 Affect Your Health Plan?


You have heard much news surrounding the coronavirus strain COVID-19 outbreak, but how does this pandemic affect your health plan?  Recent legislation from Congress, as well as follow-up frequently asked questions (FAQs) from the Departments of Labor, Health and Human Services, and Treasury, provides guidance.

The Families First Coronavirus Response Act (FFCRA) was enacted on March 18, 2020.  This Act requires all group health plans to provide coverage for the following, without imposing cost sharing – including deductibles, co-payments, and coinsurance – during the COVID-19 emergency period:

  • FDA-approved diagnostic testing for COVID-19.
  • In-person and telehealth visits to health care provider offices, urgent care centers, and emergency rooms that result in an order for or administration of diagnostic testing for COVID-19.

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), enacted on March 27, 2020, states the following:

  • All group health plans must cover, without cost sharing, COVID-19 tests for which a developer has requested or intends to request FDA emergency use authorization, tests authorized by an individual state that has notified HHS of its intention, and tests otherwise approved by HHS (in addition to FDA-approved diagnostic testing).
  • Payments to in-network providers for testing must be at the negotiated rate in effect before the emergency declaration and to out-of-network providers at the cash price listed by the provider on a public Website. All providers of COVID-19 testing must publish their cash price for testing on a public Website.
    • All group health plans must cover, without cost sharing, services intended to mitigate or prevent COVID-19 (such as a vaccine), as recommended by the United States Preventive Services Task Force or the Centers for Disease Control and Prevention.
    • HSA-qualifying HDHPs may provide first-dollar telehealth services or other remote-care services without jeopardizing an individual’s HSA eligibility. This provision is not limited to COVID-19-related remote-care services, and it will expire on the first day of the first plan year beginning on or after January 1, 2022.

The FAQs regarding implementation of the FFCRA and the CARES Act clarify the following:

  • All employer group-health plans – ERISA and non-ERISA – must comply with the Acts, but not retiree-only plans or excepted benefits (dental, vision, and medical FSA).
  • Services that may lead to a COVID-19 test during a provider visit – such as influenza tests or blood tests – must be covered without cost sharing.
  • For plan changes that provide greater coverage related to COVID-19, no enforcement action will be taken against any plan sponsor for not providing an updated Summary of Benefits and Coverage at least 60 days before the effective date of the changes, as long as the plan sponsor provides notice of the changes as soon as reasonably possible.
  • The requirement to cover COVID-19 diagnostic testing, provider visits, and prevention is in effect until the end of the declared public health emergency.

What if you offer your employees a medical FSA or an HRA?  Under the CARES Act, individuals enrolled in a medical FSA or HRA may pay for over-the-counter medicines without a prescription with account funds.  Further, eligible expenses under these accounts will now include menstrual-care products.  These changes are permanent and apply to expenses incurred on or after January 1, 2020.  However, merchants will need time to update their systems to accommodate the additional eligible items, so if you offer a debit card your participants may need to file paper claims in the interim; as always, participants should save their receipts, even for debit-card purchases.  (Note that the above changes also apply to HSAs, so employees may now use their HSAs to purchase OTC medicines without a prescription and menstrual-care products.)

If you have questions on how the COVID-19 pandemic affects your health plan(s), call ASR Health Benefits at (616) 957-1751 or (800) 968-2449.