COVID-19: Employer Health Insurance Expansion Under the FFCRA

March 26, 2020
Firm Publication

The Families First Coronavirus Response Act (FFCRA), signed into law by President Trump on March 18, imposes new requirements on health plans in response to the COVID-19 pandemic. In particular, the FFCRA requires employer health plans to expand coverage to include COVID-19 diagnostic testing at no cost to the covered individual. The new coverage requirements are effective immediately. The following FAQs are designed to provide guidance to employers in complying with the FFCRA.

What are the new COVID-19 health coverage requirements under the FFCRA?

Group health plans, whether fully-insured or self-insured, must provide coverage for COVID-19 diagnostic testing, at no cost to covered individuals, and without prior authorization or other medical management requirements.  COVID-19 diagnostic testing includes items and services furnished to the individual during healthcare provider office visits (which include in-person visits and telehealth visits), urgent care center visits and emergency room visits that result in an order for or administration of  COVID-19 diagnostic testing products, but only to the extent such items or services relating to the COVID-19 diagnostic testing or the evaluations to determine if a COVID-19 test is needed. This means that there must be no cost to covered individuals, whether in the form of copayments, coinsurance or deductible, for the COVID-19 diagnostic testing and related services. All such costs must be covered by the plan.

Do the new COVID-19 health coverage requirements apply to all group health plans, even those grandfathered plans under the Affordable Care Act?

Yes. There are no exceptions to the new health coverage requirements, whether based on the size of the employer or grandfathered status under the Affordable Care Act. Governmental plans, church plans, private employer plans, self-insured plans and fully insured plans must comply with the FFCRA. However, these requirements do not apply to group health plans that provide only “excepted benefits” – such as limited vision or dental coverage, EAPs, long-term care insurance, Medicare supplemental coverage and most health FSAs.

Does this mean that employer health plans must also cover the cost of treatment for COVID-19?

No. Under the FFCRA, employer plans are not required to cover the cost for treatment of COVID-19. To the extent that an employer plan does cover the treatment of COVID-19, there is no requirement that such coverage be provided on a no-cost basis to covered individuals. Employers should review the terms of their plan documents to determine the extent of coverage for COVID-19 treatment, and plans may be amended to add or expand coverage, subject to insurer (or stop-loss carrier, for a self-insured plan) approval.

Note that fully insured plans may be under a state mandate to provide COVID-19 treatment at reduced or no cost to covered individuals. Employers with fully insured plans should consult with their insurer for additional guidance. Also, self-insured plans should consult with their stop-loss carrier before providing coverage that is more generous than required under the FFCRA or otherwise amending their plans to ensure that stop-loss coverage will be available.

What if we offer an HSA-compatible high deductible health plan (IRS Notice 2020-15)?

With some exceptions (for example, for preventive care, dental and vision expenses), the usual rule is that providing any first dollar (no cost) coverage to covered individuals under a high deductible health plan will generally disqualify them (as accountholders) from eligibility to contribute to their health savings accounts (HSAs). However, the Internal Revenue Service recently provided some welcome COVID-19-related relief in this regard, in the form of IRS Notice 2020-15, available here. This notice assures high deductible health plan sponsors and participants that the no-cost testing coverage required by the Families First Act (and any coverage for COVID-19 treatments that the sponsor elects to incorporate into its plan if no-cost coverage is provided before the high deductible health plan’s deductible is met) will not disqualify HSA accountholders from contributing to their health savings accounts.

Note that Congress is expected to make additional changes and provide relief affecting high deductible health plans as part of a legislation package named the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which is expected to pass very soon.  We will provide an update as soon as one is available.

When must employer plans begin complying with the FFCRA?

The FFCRA was effective on March 18, 2020, and the expanded coverage requirement became effective on that date. The expanded coverage requirement will remain in effect for at least 90 days and could be extended further by the Department of Health and Human Services.

Must employer plans cover COVID-19 diagnostic services if provided by an out-of-network provider?

The FFCRA does not distinguish between in-network and out-of-network providers. Until further guidance is provided by the government clarifying otherwise, the safe course is for employers to treat out-of-network providers of COVID-19 diagnostic services the same as in-network providers.

Must employer plans treat telehealth visits the same as in-person office visits for medical treatments?

No. To the extent that COVID-19 diagnostic services are provided during a telehealth visit, they must be covered by the plan with no cost to covered individuals. There is no requirement under the FFCRA that an employer plan be expanded to cover telehealth visits that are unrelated to COVID-19 diagnostic services.

Note that Congress is expected to provide relief related to general telehealth services provided by high deductible health plans as part of the CARES Act, which is expected to pass very soon.  We will provide an update as soon as one is available.

If you have any questions about employer health insurance expansion under the FFCRA, please contact one our employee benefits attorneys.