Covering the Cost of COVID-19 Employee Testing
With the inception of the CARES Act and Families First Coronavirus Response Act (FFCRA), the patient protections were understood to include free tests for whoever needs one. These major response Acts indicated that services related to the testing and diagnosis of COVID-19 after March 18th, 2020 through the end of the public health emergency would be covered in full. Meaning, that insurers would not be allowed to impose any cost-sharing requirements, prior authorizations, or other barriers to treatment. When these Acts were first passed in April, tests were in short supply. This posed a limited financial liability to the insurers and government plans. Testing, however, has ramped up and more options have hit the market. Accordingly, the Administration’s position on who should pay and under what circumstances has shifted significantly.
The Trump Administration released guidance on April 11th and again on June 23rd that had direct impacts on testing. The April notification qualified that the responsibility for group insurers to cover testing is triggered only when it has been determined that a test is “medically appropriate for the individual as determined by the individual’s attending health care provider in accordance with currently accepted medical standards for medical practice.” The June notice went further in explicitly stating that testing for general workplace health and safety or population screening do not fall within the intended scope of FFCRA or the CARES Act.
While the Equal Employment Opportunity Commission (EEOC) has explicitly stated that employers can require employees to take a COVID-19 test before physically re-entering the workplace, there has been less clarity around the matter of payment. Per the Trump Administration’s June 23rd guidance, testing for general workplace health and safety, such as return to work programs, are now considered “outside the scope” of FFCRA and CARES as they are not intended for individualized diagnosis and treatment. This means that it is highly unlikely that the employee’s insurance will cover the cost of an employer-mandated COVID-19 test. Further compounding confusion is the silence coming from the Department of Labor (DOL) and EEOC as it relates to who, then, should pick up the tab.
Employers, absent from future directives from the DOL or EEOC, should be prepared to cover any costs associated with tests that they are mandating their employees take. Most experts recommend employers look to the Enforcement Guidance on Disability-Related Inquiries and Medical Examinations of Employees under the Americans with Disabilities Act (ADA) for direction. The ADA states that if an employer requires an employee, who they believe to pose a “direct threat,” be examined by a healthcare professional then the employer must pay all associated costs. The Centers for Disease Control and Prevention (CDC) has already declared that the current COVID-19 pandemic meets the definition of a “direct threat,” therefore it can be reasonably assumed that the employer is responsible for payment.
Concerning compensating employees for time spent getting tested, subject matter experts point to the FLSA opinion letter on employee drug testing where the DOL takes the position that time spent getting tested, including travel time, would constitute hours worked for purposes of FLSA. Employers are recommended to assume that requiring employees to undergo COVID-19 testing will be treated similarly to a required drug test.
Much of this information conflicts with the CDC’s testing recommendations, so employers must understand that some testing will not be covered unless it meets the newest prerequisites. As of August 6, 2020, Group Health Plans are requiring the three following conditions be met for the test to be eligible for coverage or reimbursement:
- Medically Necessary: This requirements generally means that tests being performed for population health screening or employment screening purposes will be excluded from coverage or reimbursement
- Determination by Attending Physician: A qualified healthcare professional needs to determine that the test is medically appropriate for it to be considered “individualized” care.
- Authorized Tests Only: This is an area where the insurance carriers and the EEOC are in agreement. If employers wish to require employees to take a COVID-19 test to return to work, the EEOC requires that the test be accurate and reliable. Similarly, insurance carriers want to see that the test is an FDA Emergency Use authorized diagnostic tool.
Aldrich is Here to Support You
As always, your Aldrich Benefits team is here to provide support for you however we can during these rapidly changing times. For further information, please contact your advisor. For more employer resources to help you navigate the developing impact of coronavirus on your business, visit our COVID-19 Resource Center.
The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Readers of this website should contact their attorney to obtain advice concerning any particular legal matter.
Meet the Author
VP, Business Development
Aldrich Benefits LP
Evan Cole partners with his clients to advise and assist them with their employee benefit plans, specializing in group and association plans. Prior to joining Aldrich, Evan was a top producing employee benefits representative for one of the nation’s largest life, disability, and dental carriers. He holds licenses for life and health in the states... Read more Evan Cole
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