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Departments Release Guidance on Insurance Coverage of OTC COVID-19 Tests and Preventative Services

Updated as of February 7, 2022.

On January 10, 2022, the DOL, HHS and Treasury (the Departments) released another round of Affordable Care Act (ACA) frequently asked questions.

The question-and-answer packet deals primarily with COVID-19 diagnostic testing. The biggest change from this round of FAQs is that beginning January 15, 2022, health plans and issuers are now required to cover over-the-counter (OTC) COVID-19 tests without an order or individualized clinical assessment by a health care provider.

However, these FAQs do not modify previous guidance, including the guidance that states plans and issuers are not required to provide coverage of testing (including OTC COVID-19 testing) for employment purposes.


FAQ 1 makes clear that plans and issuers must cover OTC COVID-19 tests without imposing cost-sharing requirements (i.e., deductibles, copayments, and coinsurance), prior authorization, or other medical management requirements unless the plan or issuer meets the safe harbors discussed in FAQs 2 and 3. Only OTC COVID-19 tests that do not require a health care provider’s order are covered under this FAQ. Plans and issuers have the option of either:

  • Reimbursing the seller directly (which is strongly encouraged by the Departments); or
  • Requiring the participant to submit a claim for reimbursement according to their internal claims procedures.

The Safe Harbors

FAQ 2 and 3 address the safe harbors available to plans and issuers. FAQ 2 provides plans and issuers may not limit coverage only to tests provided through preferred pharmacies or other retailers. However, plans and issuers may arrange for direct coverage of OTC COVID-19 tests through both its pharmacy network and a direct-to-consumer shipping program. Plans and issuers may then limit reimbursement for OTC COVID-19 tests from non-preferred pharmacies. The reimbursement limit can be no less than the actual price or $12 per test, whichever is lower. If desired, plans and issuers may provide a more generous reimbursement, up to the actual price of the test.

Direct coverage means a participant does not have to seek reimbursement for an OTC COVID-19 test.

Direct coverage programs must also reasonably ensure that participants have adequate access to OTC COVID-19 tests via in-person and online retail locations. The direct-to-consumer program may be provided through one or more in-network provider(s) or another entity designated by the plan or issuer. They still have to follow the guidance in FAQ 1 and cannot require prior authorization or other medical management before participants can receive their OTC COVID-19 test.

The general purpose of the safe harbor is to facilitate seamless access to free OTC COVID-19 tests. If a plan relies on this safe harbor but is unable to meet the requirements, they will be responsible for providing coverage consistent with the guidance in FAQ 1.

FAQ 3 states that if a plan or issuer already provides coverage without cost-sharing for COVID-19 tests, the safe harbor states that the plan or issuer must cover at least 8 tests per 30-day period (or calendar month) to avoid enforcement action. As with FAQ 1, FAQ 3 applies only to OTC COVID-19 tests administered without a provider’s involvement or prescription. Plans and issuers are still responsible for providing coverage for prescribed COVID-19 tests without limitation.

On February 4, 2022, the Departments issued additional guidance on direct access requirements. The Departments clarified plans and issuers have flexibility in how they provide access to OTC tests with no up-front costs. Generally, direct access will be adequate where OTC tests are made available through at least one direct-to-consumer shipping process and at least one in-person channel. Specifically, direct access may be through online or phone orders, a pharmacy network, non-pharmacy retailers, and OTC test distribution sites established by, or on behalf of, the plan or issuer. Plans and issuers must communicate key information on how to access OTC tests to members. A plan or issuer will not fail in providing direct access due to supply shortages out of their control and may continue to limit indirect reimbursement to $12 per test. The Departments also clarified an individual cannot double-dip OTC test reimbursement in a health FSA or HRA where the test has already been reimbursed by a plan or issuer.

Fraud, Abuse, and Consumer Support

FAQ 4 gives guidance on how plans can detect fraud and abuse.

Plans and issuers may take reasonable steps, including having participants sign a brief attestation that the OTC COVID-19 test was for personal use, will not be reimbursed by another source, will not be resold, and is not for employment purposes.

Plans and issuers may also require reasonable documentation of proof of purchase when participants submit a claim for reimbursement.

FAQ 5 gives plans and issuers options to facilitate access to and effective use of OTC COVID-19 tests. The Departments also recommend providing guidance on how to submit a claim for reimbursement, information needed to file the claim, and what documentation is required before the claim is processed.

Coverage of Preventive Services; Non-COVID-19

The remaining FAQs depart from COVID-19 guidance and cover Section 2713 of the Public Health Service Act. The FAQs generally discuss when plans and issuers are required to cover a follow-up colonoscopy without cost-sharing and what is expected of non-exempt plans and issuers that must cover contraceptive services. Specifically, FAQ 9 warns that the Departments have received many complaints that participants are being denied contraceptive coverage in violation of Section 2713 and that the Departments have begun actively investigating those complaints. Plans and issuers found to have violated Section 2713 may be subject to fines and sanctions.

Next Step for Employers

January 15 is right around the corner. Group health plans, including fully insured, self-funded, grandfathered and non-grandfathered plans, will want to confirm with their TPAs and insurers that coverage of OTC COVID-19 testing will be covered in accordance with this guidance.

For more information and workplace resources employers can leverage related to the pandemic, visit the OneDigital Coronavirus Advisory Hub. As always, if you have additional questions pertaining to your plan or situation, please reach out to your OneDigital consultant.