Reimbursement of COVID-19 Testing: Private Payors

COVID-19 relief legislation, i.e., the Families First Coronavirus Response Act (FFCRA) and Coronavirus Aid, Relief, and Economic Security Act (CARES) require payors to cover COVID-19 testing without charging consumers for out-of-pocket expenses. On April 11, CMS issued guidance for implementing these requirements.

The COVID-19 Lab Test Reimbursement Rules

Enacted on March 18, FFCRA requires group health plans and health insurers offering group or individual health insurance coverage (but not short-term health plans) to provide benefits for certain items and services related to diagnostic testing for SARS-CoV-2 or diagnosing COVID-19 (which, for simplicity’s sake, we’ll refer to collectively as “COVID-19”). To ensure testing is free, FFCRA bans imposition of: i. cost-sharing requirements like deductibles, copayments and coinsurance; and ii. prior authorization and other medical utilizaton requirements.

On March 27, CARES amended FFCRA to include a broader range of diagnostic items and services that plans and issuers must cover without cost-sharing or prior authorization requirements. CARES Act also requires plans and issuers to reimburse providers of COVID-19 diagnostic testing an amount equal to its negotiated rate with the provider; if there is no negotiated rate, reimbursement must be at the cash price for such service listed by the provider on a public website. The plan or issuer may also negotiate—but not unilaterally apply—a rate with the provider that’s lower than the listed cash price.

3 Key Takeaways from the CMS Guidance

There are three key points in the guidance that lab managers need to know to ensure they receive proper reimbursement for COVID-19 tests during the emergency:

1. The Source of the Test Order

The guidance clarifies that the no-cost-sharing-requirement applies to COVID-19 tests ordered as a result of urgent care visits, emergency room visits and in-person and telehealth visits to a doctor’s office.

2. The COVID-19 Tests Covered

According to the guidance, covered COVID-19 tests include:

• All FDA-authorized coronavirus tests, which includes serology tests receiving emergency use authorization (EUA);
• Tests that developers for which test makers have requested but not yet received EUA; and
• Diagnostic tests developed in and authorized by states.

 The Effective Date

The COVID-19 testing reimbursement requirements apply to all testing and related services furnished on or after March 18, 2020 and will continue to apply for as long as the emergency lasts. is retroactive for testing and related services provided on or after March 18.