COVID-19: Its Effects on Group Health Plans in a Changed World
The COVID-19 pandemic, in combination with various stay-at-home orders attempting to “flatten the curve” and avoid new surges, has forced employers and health care issuers to adapt to statutory and regulatory changes to covered group health care plans. Against a backdrop of governmental orders, and as those orders now begin to lift in stages and employees continue social distancing and wearing personal protective equipment (PPE) in a changed workplace under a COVID-19 return-to-work plan, covered employers offering group health plans confront a challenging array of statutory requirements and constantly evolving agency guidance.
Some of the health care plan requirements imposed during social distancing and stay-at-home orders, such as telehealth services, may become permanent plan features covering certain vulnerable groups within the plan participant population. In the 21st Century, nations now confront the specter of increased zoonotic virus (passed from animals to people) pandemics.
This Client Alert addresses plan disclosure requirements as governmental orders lift, as well as mandatory requirements and optional coverages, refined by recent agency guidance and question-and-answer sessions with governmental officials, for group health plans and health care insurers of group plans in a changed world.
Plan Disclosure Requirements for COVID-19 Coverages:
The “CARES Act” (the Coronavirus Aid, Relief, and Economic Security Act), the “Families First Act” (the Families First Coronavirus Response Act, as amended by the CARES Act,) and tri-agency interpretations of both federal acts directly impact the administration of group health plans and their health care issuers.
Mandatory federal requirements apply without employee election and without delay for mid-year plan change elections, at least during the COVID-19 pandemic emergency.
The Department of Health and Human Services (HHS) announced that, in the interest of coverage, it will not penalize employers for putting in place these greater coverage requirements for diagnosis of and treatment for COVID-19 without 60-days’ advance notice under Section 2715(d)(4) of the Public Health Act regarding a mid-year change to a summary of benefits and coverage. However, HHS has also announced that notice must be given as soon as reasonably practicable.
Employers may even conclude that expansions of certain services under these mandatory and optional coverage requirements, appropriately priced, should continue as part of their COVID-19 “return to work” plans during the current pandemic and perhaps even beyond, for benefit recruitment and retention efforts.
Please contact your Butzel Long attorney or any member of Butzel Long’s Employee Benefits team regarding the notices, plan communications, and plan amendments required to describe the federal requirements for COVID-19 testing and preventive or mitigating services and any optional coverages permitted.
Mandatory Requirements under Federal Acts:
No Cost-Sharing Diagnostic Tests & Expanded Testing Sites
As amended by the CARES Act and as clarified by recent guidance, during the COVID-19 pandemic emergency, the Families First Act eliminates group health plan cost-sharing and preauthorization for in-vitro diagnostic testing products used or ordered during a traditional or non-traditional “visit” to detect the SARS-CoV-2 virus, identified in recent guidance as the novel virus that causes COVID-19.
Guidance issued in mid-April has clarified that in-vitro diagnostic testing products include serological tests for SARS-CoV-2 antibodies, but only if those serological tests otherwise meet the requirements of Section 6001 of the Families First Act, as amended by Section 3201 of the CARES Act. At this writing, the unavailability of reliable testing (including early serological tests against which the CDC has cautioned) has complicated return-to-work plans. Approvals change rapidly, and we recommend that you consult your Employee Benefits counsel.
The CARES Act amended the Families First Act to approve expanded testing products beyond FDA-approved tests. Additional testing products approved in the CARES Act include those that a) the test manufacturer is seeking or intends to seek authorization for emergency use from the FDA (unless previously denied), b) states have developed and authorized after notifying the Health and Human Services Administration (HHS) (CARES Act); and c) HHS approves in guidance (CARES Act).
Guidance has also clarified that testing products to which these requirements apply to both in-network and out-of-network providers of testing products. For a testing product from an in-network provider, the negotiated rate between the group health plan or its health care issuer and the test provider remains in effect throughout the COVID-19 emergency period. For an out-of-network testing product, unless the group health care plan or its health care issuer negotiates a rate less than the cash price, the cash price for a COVID-19 or other testing product that the test provider is required to post on a public internet website remains the price for the testing product.
The guidance has further clarified that traditional and non-traditional “visits” include in-person and telehealth visits, as well as drive-through screening and testing sites manned by health care providers. Thus, the guidance has also implied that such visits are covered, whether in-network or out-of-network. Future guidance on this issue (among others) is expected.
Guidance has clarified that, in addition to tests for the viruses themselves, no cost-sharing and no preauthorization and no medical management requirements apply to “items or services” related to eligibility for testing, as well as testing to detect the presence of SARS-CoV-2.
Under the guidance, an attending health care provider determines whether an item or service is appropriate, consistent with accepted medical standards of care, and uses or orders for use that item or service a) to assist in the diagnosis of the presence of the virus, or b) to assist in determining eligibility for testing (such as blood tests or influenza tests).
15 Business Days to Cover Recommended Qualifying Test, Item or Service for Preventive or Treatment Purposes
Covered group health plans must also include coverage without cost-sharing provisions within 15 business days after the attending health care provider recommends a “qualifying coronavirus preventive service.”
Qualifying coronavirus preventive services include any item, service, or immunization intended to prevent or mitigate COVID-19 that meets the following criteria:
- An evidence-based item or service that has in effect a rating of “A” or “B” in the current recommendations of the United States Preventive Services Task Force; or
- An immunization that has in effect a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention with respect to the individual involved.
The CARES Act permits plan participants to use a health savings account (“HSA”), flexible spending account, health reimbursement account, and Archer medical savings account dollars on non-prescribed over-the-counter drugs and on menstrual care products, effective after December 31, 2019. The CARES Act does not provide an explicit sunset provision for this change, although it is possible one could be forthcoming (meaning, at this time, the change is indefinite).
For plan years beginning on or before December 31, 2021, any participant in a high deductible health plan (“HDHP”) will not lose eligibility to contribute to an HSA simply because the HDHP does not charge a deductible for telehealth and other remote care services. This rule expands upon recent Internal Revenue Service Notice 2020-15 permitting such relief from ineligibility to contribute to an HSA simply because the HDHP does not charge a deductible for testing or treatment of COVID-19.
Further Guidance Expected
Because guidance regarding these mandatory and optional coverages and plan disclosures is continually updated, and because Congress continues to address additional employee health care needs during the COVID-19 pandemic, plan sponsors should reach out to their administrative service providers or insurers to assess the need for modifications to their group health plans and plan disclosures. Please contact your Butzel Long attorney or a member of the Employee Benefits team for assistance.