Guidance Strengthens Health Plans' Obligations for COVID-19 Coverage

Plans must cover approved vaccines, pay for testing despite lack of symptoms

By Christine Clements © Sheppard, Mullin March 5, 2021
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Guidance Strengthens Health Plans Obligations for COVID-19 Coverage

On Feb. 26, the Departments of Labor, Health and Human Services, and the Treasury (the "tri-agencies") issued Frequently Asked Questions (FAQs) and a related press release addressing the implementation of the Families First Coronavirus Response Act (FFCRA), the Coronavirus Aid, Relief and Economic Security (CARES) Act and other health coverage issues related to COVID-19.

COVID-19 Diagnostic Testing

The FFCRA requires group health plans and health insurance issuers offering group or individual health insurance coverage, including grandfathered health plans, to cover certain items and services related to the testing and diagnosis of COVID-19 without cost-sharing, prior authorization or other medical management requirements. The CARES Act expanded the range of diagnostic items and services that plans must cover. 

The CARES Act also requires plans to reimburse any provider of COVID-19 diagnostic testing at an amount that equals the negotiated rate or, if the plan does not have a negotiated rate with the provider, the cash price for such service that is listed by the provider on a public website.

Among other topics, the FAQs address:

  • Plans cannot require the presence of symptoms or a recent known or suspected exposure to COVID-19, or otherwise impose medical screening criteria on coverage for tests.
  • Plans are to assume that, when an individual seeks and receives a COVID-19 test from a licensed or authorized provider or is referred for a test by such a provider, the receipt of the test reflects an "individualized clinical assessment" and the test should be covered without cost sharing, prior authorization or other medical management requirements.
  • This coverage obligation includes tests obtained from a state- or locality-administered site, a "drive-through" site, or a site that does not require appointments.
  • Plans may distinguish between COVID-19 diagnostic testing of asymptomatic people that must be covered, and coverage for testing for general workplace health and safety, for public health surveillance or for other purposes not primarily intended for individualized diagnosis or treatment of COVID-19. Per the FAQs, plans are not required to cover testing for public health surveillance or employment purposes.
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Coronavirus and COVID-19

Coverage of Vaccines and Coronavirus Preventive Services

Section 3203 of the CARES Act requires nongrandfathered group health plans and health insurance issuers offering nongrandfathered group or individual health insurance coverage to cover, without cost-sharing requirements, any qualifying coronavirus preventive services.

Among other topics, the tri-agency FAQs address:

  • Nongrandfathered plans must provide coverage without cost sharing for all COVID-19 vaccines that have received a recommendation that makes them a qualifying coronavirus preventive service with respect to the individual involved, and their administration.

    Who Pays for COVID-19 Vaccines?

    Separately, a set of Centers for Disease Control and Prevention (CDC) FAQs, posted Feb. 25, answers "Who Is Paying for the COVID-19 Vaccines?" as follows:

     "The federal government is providing the vaccine free of charge to all people living in the United States. Vaccination providers can be reimbursed for vaccine administration fees by the patient’s public or private insurance company or, for uninsured patients, by the Health Resources and Services Administration’s Provider Relief Fund. No one can be denied a vaccine if they are unable to pay a vaccine administration fee.​"


  • Coverage of COVID-19 vaccines must begin no later than 15 business days after the date the U.S. Preventive Services Task Force or the advisory committee on immunization practices of the Centers for Disease Control and Prevention makes an applicable recommendation regarding a qualifying coronavirus preventive service.
  • Nongrandfathered plans may not deny coverage of recommended COVID-19 vaccines because an individual is not in a category recommended for early vaccination.
  • A decision by an individual's health care provider (including a provider integrated with a health plan) to decline to give the vaccine to someone because he or she is not within a prioritization category is not an adverse benefit determination made by a group health plan or health insurance issuer. Therefore, the provider's decision is not subject to internal claims and appeals and external review requirements.

Christine Clements is a partner at law firm Sheppard Mullin in Washington, D.C. © 2021, Sheppard, Mullin, Richter & Hampton LLP. All Rights Reserved. Republished with permission.

[This article is not an unequivocal statement of the law, but instead represents our best interpretation of where things currently stand. This article does not address the potential impacts of the numerous other local, state and federal orders that have been issued in response to the COVID-19 pandemic, but which are not referenced in this article.]

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