Ice Miller LLP: Insights

FAQs Clarify Health Plan Requirements of FFCRA and CARES Act

On April 11, 2020, the U.S. Departments of Labor, Health and Human Services, and the Treasury (together, "Departments") jointly released frequently asked questions ("FAQs") regarding the implementation of the health coverage provisions of the Families First Coronavirus Response Act ("FFCRA") and the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act").

The FAQs clarify a number of details with regard to the new obligations of health plans under the FFCRA and CARES Act, including:

Serological Tests. Required coverage for an "in vitro diagnostic test" for COVID-19 includes coverage for a serological test.
Influenza Tests, Blood Tests, and Other Services. Tests and services that are not in vitro COVID-19 diagnostic tests must be covered—without cost sharing—if the provider decides the tests or services should be performed to determine whether COVID-19 diagnostic testing is necessary, and if the visit results in an order for, or administration of, COVID-19 diagnostic testing.
Out-of-Network Providers. Required coverage without cost sharing encompasses tests and services provided by out-of-network providers and plans must reimburse them according to negotiated or published rates.
Drive-Through Tests. Required coverage includes both traditional and non-traditional care settings, including, for example, drive-through screening and testing sites.
SBC Advance Notice Non-Enforcement. The Departments have adopted a non-enforcement policy with regard to the advance notice requirement for material modifications affecting the summary of benefits and coverage that relate to implementing the FFCRA and CARES Act requirements.
State Standards. States may impose additional standards and requirements that are not incompatible with the federal requirements.
On-Site Clinics and EAPs. Employee assistance plans and on-site clinics may provide coverage for COVID-19 testing without compromising their status as excepted benefits.
Telehealth and HSAs. High deductible health plans may cover telehealth visits (even for non-COVID-19 reasons) without a deductible through December 31, 2021 without making participants ineligible to contribute to a health savings account.

We expect the Departments to issue additional guidance implementing the FFCRA and CARES Act in the future.

Background

The FFCRA became law on March 18, 2020, and requires health plans to provide coverage—without any cost sharing, prior authorization, or other medical management requirements—for in vitro diagnostic products and services related to diagnosing COVID-19. We discuss the FFCRA in more detail here.

The Cares Act became law on March 27, 2020, and made a number of changes for health plans in relation to the COVID-19 pandemic, including expanding the requirement to cover COVID-19 diagnostic testing, clarifying the prices plans are required to pay for COVID-19 diagnostic testing, requiring coverage of COVID-19 preventive treatment within 15 days of an administrative recommendation, and adding a temporary safe harbor for high deductible plans to cover telehealth services. We discuss the CARES Act in more detail here.

The FFCRA's coverage mandate provided for implementation by the Departments through sub-regulatory guidance.

Coverage Mandate Applies Broadly to Almost All Plans

The FAQs confirm that Section 6001 of the FFCRA, as amended by Section 3201 of the CARES Act ("Coverage Mandate"), applies broadly to group health plans and health insurance issuers of group or individual coverage, including:

Grandfathered plans;
Insured plans;
Self-insured plans;
ERISA plans;
Non-federal governmental plans;
Church plans;
Coverage offered in the individual market; and
Student health insurance coverage.

However, the following are not subject to the Coverage Mandate:

Short-term, limited-duration insurance;
Excepted benefits (such as on-site clinics, limited scope dental and vision coverage, long-term care, and nursing home care); and
Retiree-only plans.

Coverage Mandate Requires Coverage for Items Furnished On and After March 18

The FAQs clarify that the Coverage Mandate requires coverage for items and services that were furnished on or after March 18, 2020. The Coverage Mandate continues to apply for the duration of the COVID-19 public health emergency. Unless it is extended or terminated early, the current COVID-19 public health emergency is set to expire on June 16, 2020.

This confirms that although the FFCRA requires coverage for products and services furnished during "any portion of the COVID-19 public health emergency," the Coverage Mandate operates only prospectively from the date the FFCRA became law.

Items and Services that Must Be Covered

In addition to the items and services we described in our prior publications (found here), the FAQs clarify that:

Serological Tests. A required "in vitro diagnostic test" includes a serological test for COVID-19. Serological tests for COVID-19 are used to detect antibodies against the SARS-CoV-2 virus and are intended for use in the diagnosis of the disease or condition of having current or past infection with SARS-CoV-2, the virus which causes COVID-19. The Food and Drug Administration does not currently believe they should be the sole basis for diagnosis. To date, the Food and Drug Administration has authorized only one emergency use authorization for a serological test that is intended for use by clinical laboratories.
Influenza Tests, Blood Tests, and Other Services. A test that is not an in vitro diagnostic test must be covered if the provider determines that it should be performed to determine whether COVID-19 diagnostic testing is necessary, and if the visit results in an order for, or administration of, COVID-19 diagnostic testing. The FAQs provide the following example:

Therefore, for example, if the individual’s attending provider determines that other tests (e.g., influenza tests, blood tests, etc.) should be performed during a visit (which term here includes in-person visits and telehealth visits) to determine the need of such individual for COVID-19 diagnostic testing, and the visit results in an order for, or administration of, COVID-19 diagnostic testing, the plan or issuer must provide coverage for the related tests under section 6001(a) of the FFCRA. This coverage must be provided without cost sharing, when medically appropriate for the individual, as determined by the individual’s attending healthcare provider in accordance with accepted standards of current medical practice. This coverage must also be provided without imposing prior authorization or other medical management requirements.

Out-of-Network Providers

The FAQs clarify that the Coverage Mandate applies to tests and services provided by out-of-network providers, and that Section 3202(a) of the CARES Act, which specifies the price that plans must pay for services required by the Coverage Mandate, applies equally to out-of-network providers. Thus, plans must reimburse out-of-network providers any negotiated rate in effect before the COVID-19 public health emergency, or otherwise the cash price for the service listed on the provider's public website.

A "Visit" Includes Both Traditional and Non-Traditional Care Settings

The Coverage Mandate requires coverage of "items and services furnished during a visit to a provider's office (which . . . includes in-person visits and telehealth visits), urgent care center visits, and emergency room visits." According to the FAQs, the Departments construe the term "visit" broadly to include both traditional and non-traditional care settings.

This means the Coverage Mandate applies to drive-through screening and testing sites, among others.

Non-Enforcement Policy for SBC Advanced Notice Requirement

Section 2715 of the Public Health Service Act ("PHSA"), as added by the Affordable Care Act, requires plans to provide a Summary of Benefits and Coverage ("SBC"), including an updated SBC or notice if the plan makes a material modification in any of the terms that would affect the content of the SBC. Notice is required within 60 days prior to the date the modification becomes effective.

The FAQs clarify that the Departments "will not take enforcement action against any plan or issuer" that makes a coverage modification "to provide greater coverage related to the diagnosis and/or treatment of COVID-19," even if the plan/issuer does so without providing at least 60 days advance notice.This non-enforcement policy also applies to plans and issuers that change coverage to provide telehealth and other remote care services.

Both non-enforcement policies apply to changes made during the public health emergency or national emergency declaration related to COVID-19. They cease to apply once the emergency declarations expire.

Importantly, plans and issuers must still provide notice of their coverage changes "as soon as reasonably practicable." In addition, the Departments will continue to take enforcement action against any attempts to limit or eliminate benefits or increase cost-sharing to offset the expense of the Coverage Mandate.

States May Impose Additional Requirements

The FAQs clarify that states may impose additional standards and requirements that are not incompatible with the federal requirements.

EAPs and On-site Clinics May Provide Coverage for COVID-19 Testing

So-called "excepted benefits" are exempt from a number of laws that normally apply to health plans, including many provisions of the Affordable Care Act and HIPAA portability standards. Employee assistance programs ("EAPs") are excepted benefits as long as they, among other things, do not provide significant benefits in the nature of medical care. The FAQs clarify that EAPs will not be considered to provide such benefits solely because they offer benefits for the diagnosis and testing for COVID-19 during the public health emergency or national emergency. In addition, on-site medical clinics are also considered to be excepted benefits, and the FAQs confirm they will not lose that status simply by providing benefits for the diagnosis and testing for COVID-19.

Promotion of Telehealth

The FAQs conclude with a strong emphasis on telehealth. The Departments noted that, by using telehealth, "patients are able to seek treatment from a healthcare professional in their home, without having to go to a medical office or hospital, helping minimize the risk of exposure to and community spread of COVID-19." The Departments strongly urge plans to promote the use of telehealth and other remote care services by "ensuring access to a robust suite of telehealth and other remote care services, including mental health and substance abuse disorder services, and by covering telehealth and other remote care services without cost sharing or other medical management requirements."

The CARES Act provides a temporary safe harbor for high deductible health plans ("HDHPs") to cover "telehealth and other remote care services" without a deductible. The relief extends through plan years that begin on or before December 31, 2021. Telehealth visits do not have to be connected with COVID-19 to be eligible for this relief. This means participants covered by an HDHP that provides first-dollar coverage for telehealth and remote care services (for any reason) will not lose their eligibility to contribute to health savings accounts through plan years beginning on or before December 31, 2021.

For more information about the FFCRA, CARES Act, and related guidance and how they might affect your employee benefit plans, please contact Chris Sears, Kathleen Sheil Scheidt, Melissa Proffitt, Tara Sciscoe, Sarah Funke, Gary Blachman, Rob Gauss, Audra Ferguson-Allen, Austin Anderson, or the Ice Miller LLP Employee Benefits attorney with whom you work.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.