In general, the FAQs largely repeat the requirements set out in the two laws. However, they do include clarifications and temporary policies of relaxed enforcement, as summarized on this page.

The requirements apply to almost all group health plans

The requirements apply to group health plans, whether insured or self-insured, and regardless of their grandfathered status under the ACA. They apply to employment-based plans subject to ERISA, as well as to non-federal governmental plans.

Separate retiree-only plans are not required to comply with the requirements. However, Medicare Part B covers the cost of COVID-19 tests at no cost for retirees who are enrolled in Medicare or a Medicare Advantage plan.

Effective dates for the requirements

The requirements took effect on March 18, 2020, and apply for the duration of the COVID-19 public health emergency. 

Clarification of tests and visits that must be covered without cost sharing

COVID-19 tests: Plans must cover without cost sharing in vitro diagnostic tests that are approved by the Food and Drug Administration (FDA), for which the developer has requested emergency use authorization, or that are authorized by a state. The products that must be covered include serological tests that are used to detect antibodies against the virus (thus indicating whether the person has been exposed to the virus).

Related tests: The Families First Act requires coverage of items or services furnished during a provider “visit” that results in an order for, or administration of, a COVID-10 diagnostic test. If a health care provider decides to first do other related tests (e.g., blood tests or influenza tests), and the visit results in an order for, or administration of, a COVID-19 test, the plan must cover these related tests without cost sharing.

Settings of care: The term “visit” (e.g., office visit, urgent care visit, emergency room or telehealth visit) will also encompass non-traditional settings such as drive-through sites where licensed healthcare providers administer the tests.

Guidance on telemedicine

Telehealth has become widely available in response to the COVID-19 public health emergency, both through telemedicine companies and through virtual visits from health care providers under more lenient HIPAA security standards announced by HHS. The Departments “strongly encourage” plan sponsors to promote the use of telehealth and other remote-care services by offering a “robust suite” of such services — including for mental health and substance use disorder services — without cost sharing and notifying participants of their availability.

To the extent that such services are available, the Families First Act requires that cost sharing not be applied to telehealth visits that result in the ordering of a diagnostic test for COVID-19. However, the Departments do not require plans to otherwise offer telemedicine services in order to comply with the COVID-19-related testing requirements.

Guidance on medical management

The FAQs clarify that the prohibition on prior-authorization requirements and other medical management requirements for COVID-19 testing services means that items and services must be covered without cost sharing when medically appropriate. An individual’s attending healthcare provider determines what is medically appropriate in accordance with accepted standards of current medical practice.

Guidance on reimbursing out-of-network providers

Providers of diagnostic testing that are not in the plan’s network must be reimbursed the cash price posted on the provider’s public internet site (or any lower price negotiated by the plan and the provider).

Guidance on notice requirements

Plan sponsors that enhance the plan’s diagnostic testing services to comply with these new federal laws (including the waiver of cost sharing and any expansion of telehealth) need not be concerned about violating the 60-day advance notice requirement that applies to material mid-year changes that affect the content of the plan’s Summary of Benefits and Coverage (SBC). Plan sponsors are advised to provide notice of these benefit changes as soon as reasonably practicable. If plan sponsors extend such coverage beyond the public health emergency (or the national emergency declared March 13, 2020), plan sponsors will need to comply with all other applicable requirements to update plan documents.

This non-enforcement policy with respect to advance notice under the SBC rules also applies to enhancements to a plan’s coverage of treatment services for COVID-19 (although these new federal laws do not require group health plans to cover treatment-related services or to waive cost sharing for them).

Any other plan changes that limit or eliminate benefits or increase cost sharing not related to COVID-19 are still subject to existing documentation and notice rules.

Guidance on EAPs and on-site clinics

Employee assistance programs (EAPs) that meet the requirements to be considered “excepted benefits” (and thus not subject to many federal laws) will be able to provide diagnostic and testing services for COVID-19. One key requirement that qualifies an EAP as an excepted benefit is that the EAP cannot provide “significant benefits in the nature of medical care.” If the EAP otherwise meets this “excepted benefits” requirement, the provision of diagnostic and testing services for COVID-19 during the public health emergency (or the national emergency declared March 13, 2020) will not cause the EAP to be treated as providing significant benefits in the nature of medical care.

Coverage of on-site medical clinics is an excepted benefit in all circumstances and may be a setting in which employers or plan sponsors may seek to provide COVID-19-related testing services.

Implications for plan sponsors

Plan sponsors will find these additional clarifications and non-enforcement policies helpful as they work to ensure that coverage for benefits is provided in compliance with the new laws.

Plan sponsors that do not offer telehealth or other remote care services may wish to offer such services in light of the public health emergency. Employers or multiemployer plans that offer an EAP or on-site clinic may wish to explore the feasibility of offering COVID-19 diagnostic and testing services through their EAP or on-site clinic.

This information is for informational purposes only and does not constitute legal or tax advice. Plan sponsors are encouraged to discuss the issues raised here with their legal, tax and other advisors before determining how they apply to their specific situation. On all issues involving the interpretation or application of laws and regulations, you should rely solely on your legal counsel for legal advice.