Legislative Update: COVID-19: Self-Funded Impacts of Economic Stimulus Phase 3

March 26, 2020: After several days of negotiations between Congress and the White House, the US Senate passed the third COVID-19 stimulus package on a 96-0 vote. The House indicated they would take up consideration by Friday. This third stimulus package, expected to pass without further changes, currently includes several notable provisions that self-insured health plans should be aware of:

Free Coverage for Testing for COVID-19:  Individual and group health plans, including both fully-insured and self-insured, must cover COVID-19 testing, whether that testing is FDA-authorized or not. Concerns were raised with language included in the second stimulus package that required coverage for FDA-authorized tests only. Many tests are not FDA-authorized, meaning individuals would be charged for the cost of these tests. The clarification language in the current package eliminates any confusion.

Payment Amount for COVID-19 Testing and Related Services: Self-insured health plans and insurance carriers must pay the provider performing the testing for COVID-19 (along with costs incurred during the medical visit when testing is performed) at an amount equal to their in-network negotiated rate for the testing and related services. If the carrier or self-insured plan does NOT have a negotiated payment rate, or does not subsequently negotiate a specified price with the provider, the legislation directs the payment amount to equal the cash price of the service, which is required to be posted by the provider on a publicly available internet site. Providers would face a civil monetary penalty of $300 per day if such information is not publicly posted.

Free Coverage for COVID-19 Vaccine:  As you know, the Affordable Care Act (ACA) requires both fully-insured and self-insured health plans to provide free coverage for certain preventive services. The legislation provides that once a COVID-19 vaccine is developed and “recommended” as a preventive service, insurance carriers and self-insured plans must cover the cost of the vaccine without any cost-sharing. This no cost-sharing requirement would go into effect 15 days after the availability of an approved vaccine.

HSA-Eligible HDHP Exemption for Telehealth:  An HSA-eligible high-deductible health plan (HDHP) would be allowed to pay for the costs associated with a telehealth plan before the deductible is met, and the HDHP-policyholder would continue to be eligible to make tax-free contributions to their HSA. This exemption, however, is only available for the 2020 and 2021 plan year.

Payment for COVID Treatment: Up to this point, many SIIA members have been wondering whether Congress will require free coverage for the treatment of COVID-19. This third stimulus package stops short of requiring coverage for treatment (only requiring free coverage for testing and related services). However, House and Senate Leadership have signaled the possibility of a fourth stimulus package at some future date, and a number of Senate Democrats have issued a letter supporting COVID-19 treatment without cost-sharing.

HSA/ FSA Payments for OTC Medical Products without Prescription: A patient may use funds from a Health Savings Account of Flexible Spending Account for the purchase of over-the-counter medical products, including those needed in quarantine and social distancing, without a prescription from a physician.

Surprise Billing:  While a number of discussions were held on the inclusion of specific surprise billing provisions as part of Phase 3, those policy changes did not come to fruition. However, with the numerous policy issue taken care of within the stimulus package, the health tax extender deadline set for May 22^nd has now been pushed out to November 30^th. However, understanding that a Phase 4 package is possible, ongoing discussions are occurring on surprise billing, including proposals to prohibit surprise billing during the National Emergency, or instituting a 4-year ban as part of treatment language.

Thanks to our friends at SIIA for some content for this piece.