On February 4, the tri-agencies (DOL, HHS and Treasury) issued new FAQs on the requirement for group health plans and issuers to cover over-the-counter (OTC) COVID-19 tests without cost-sharing, prior authorization, or other medical management requirements. We discussed the tri-agencies’ initial FAQs in our prior blog post.

The coverage requirement is still in place, but these new FAQs provide clarifications in response to the tri-agencies’ receipt of stakeholder questions—primarily about the “safe harbor” permitting the limit of reimbursements to $12 per test (or actual cost, if less) if the test is purchased outside a direct coverage program.

Per these new FAQs, plans and issuers are to have “significant flexibility in how they provide access to OTC COVID-19 tests” provided that, based on all facts and circumstances, individuals have adequate access to such tests with no upfront out-of-pocket expenditures. “Direct coverage” may be provided through a number of mechanisms, including, but not limited to, the plan’s or issuer’s pharmacy network, in-person distribution sites established by or on behalf of the plan or issuer, or a direct-to-consumer shipping program that accepts online or telephone orders (and does not require individuals to obtain tests at an in-person location).

In addition to providing more direction on how to comply with the direct coverage safe harbor, these new FAQs provide other points of clarification—including, but not limited to, the following:

  • Under the direct coverage safe harbor, reasonable shipping costs must also be covered, consistent with coverage by the plan or issuer of other items or products provided via mail order.
  • Enforcement action will not be taken against a plan or issuer that is temporarily unable to provide adequate access through its direct coverage program due to a supply shortage, if the plan or issuer otherwise satisfies the safe harbor requirements.
  • The plan or issuer may disallow coverage of OTC COVID-19 tests purchased from sources that are not established retailers or typically expected to sell such tests—such as private individuals, online auctions, or resale marketplaces.
  • The OTC COVID-19 coverage requirement does not apply to tests that are self-administered but must be read or processed by a lab or other health care provider (e.g., PCR tests); however, coverage of such tests could still be required under section 6001 of FFCRA (e.g., if ordered by a health care provider).
  • An individual cannot seek reimbursement from a health flexible spending account (Health FSA), health reimbursement arrangement (HRA), or health savings account (HSA) for the cost or portion of the cost of an OTC COVID-19 test that was covered by the plan or issuer.