Health insurance coverage of COVID-19-related expenses
So you heard that the Families First Coronavirus Response Act was passed on March 18th, making coronavirus testing free for everyone… Do not assume all or any of your COVID-19-related expenses will be covered! Let’s walk through the situations you might face:
First, a bit of background: The Act requires group health plans and individual health insurance coverage to cover testing and visits related to the diagnosis of COVID-19.
What plans are excluded? The Act does not apply to specific types of private coverage sold to individuals which are not subject to federal standards, that are not regulated as health insurance products, and/or that do not cover essential health benefits.
Who is excluded? Recall that individuals that are covered under the excluded plans mentioned above are considered uninsured in the eyes of the Act. The Act gives the states the option to provide free testing to this total uninsured population through Medicaid. Does this sound like states that opted for the Medicaid expansion will provide a better protection for their individuals? Indeed it does. The Act also appropriates $1bil to the National Disaster Medical System to reimburse providers for the costs associated with the testing and diagnosis of COVID-19 for the uninsured.
What treatments are excluded? Only free testing/diagnosis is directly required in the Act. There is no federal requirement for the level of coverage of treatment that follows a positive diagnosis of COVID-19. What does this mean? It means that it is all up to the plan you hold. The excluded plans from above are not subject to any standards. Uninsured individuals are not addressed regarding the coverage of COVID-19 treatment. For everybody else, it truly depends on the plan purchased and on the state of residence for coverage to be determined. The essential health benefits in the ACA only include the categories to be covered, but the specific covered services are decided by the states. Bear in mind that large-employer-provided health plans are not required by law to cover essential health benefits. While the strong majority do, Kaiser estimates that about 4 percent of large employers offer cheap mini plans that cover no hospitalizations or emergency care. For people on those plans, coverage for treatment would be small at best.
Private health insurance plans can choose to provide services for free. However, while many private insurers have announced their provision of COVID-19 testing for free, the same is not true for treatment. Call your health insurance provider to know exactly what they are covering.
Assume that any waived costs for testing or treatment is only true for your IN-NETWORK providers.
Recall that in the US, even if you go to an in-network hospital, you would be charged out-of network prices if the physician that carries out the procedure (testing, treatment,…) is out of your insurance network. Can you do anything then? Nothing. If possible, seek testing outside of an emergency room, as likelihood of that happening is lower. However, your in-network primary care provider could still send the test to an out-of-network lab, which would—you guessed correctly—lead to an out-of-network bill.
Know your insurance plan regarding network costs! Some insurance plans will provide a different (if any) level of coverage for out-of-network vs. in-network services. Find out the maximum out-of-pocket costs for both cases. Bear in mind that deductibles are also usually separate: even if you already fulfilled your in-network deductible, you might (and most likely would) face a separate deductible for out-of-network services.
Know your insurance plan regarding authorization and geographical restrictions! While some insurances are waiving restrictions to testing for COVID-19, such as prior authorizations, and some states have enacted similar directives to require their state-regulated health insurance plans to do the same, this is not true for everybody! Check with your health insurance provider, especially while you are healthy. Knowing what to do and where to go will save you precious time (and money!) if you were to get infected.
If your state passed directives mandating free testing or even higher coverage levels, this is true only for state-regulated plans! In particular, those plans that are not subject to any federal standards, that are not categorized as health insurance products, and all employer-sponsored health plans are not regulated by states.
You are insured and want to get an idea of where you stand:
If you have a short-term health plan (those that you can buy here), if you are part of a health care sharing ministry (Wiki definition), if you live in Iowa or Tennessee and have purchased the private health coverage offered by their Farm Bureaus, you are not covered by the Act and even testing does not have to be free. In the eyes of the Act, you are considered uninsured.
If you purchased a mini health plan from your employer that does not cover hospitalization or emergency care, treatment for COVID-19 does not have to be covered.
For Medicaid, 23 states now have waivers to limit restrictions such as physician enrollment for the coronavirus response. The states are Alabama, Arizona, California, Florida, Iowa, Illinois, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Virginia, Washington. The extent of the waiver depends on the state. Find more info on the specific state here.
For any other health plan, the cost of treatment depends on your plan.
You are uninsured or you have one of the plans mentioned above that make you uninsured in the eyes of the Act:
The Act gave states the option to provide free testing through Medicaid coverage.
The White House also announced that $100bil would be directed toward hospitals and health providers for treatment for uninsured patients diagnosed with COVID-19. Hospitals will be reimbursed at Medicare rates.
Call health care providers close to you and ask how they are dealing with coronavirus patients that are uninsured. Hospitals and providers might be offering reduced prices or financial assistance. Ask to talk to their billing department or to their financial assistance department. Do that while you are healthy.
If you lost your job and your income is low enough and are suddenly uninsured, you might qualify for Medicaid, especially in states that opted for the Medicaid expansions (where the income threshold is higher). In these states, you qualify as long as you have an income of $1,467/month per individual. Unemployment benefits count as income.
Medicaid was not expanded in these 14 states: Alabama, Florida, Georgia, Kansas, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Wisconsin, Wyoming. In these states, you qualify under very strict situations.
Because of this, the $100bil relief for health care providers is highly likely to disproportionately go to states that did not expand Medicaid and that are facing a larger percentage of the population being uninsured to cover everything from testing to hospitalizations. This in turn reduces the funds available to states that have expanded Medicaid and that have a smaller share of the population uninsured, but that might need these funds for the most urgent cases that require hospital services.
If you lost your job and you do not qualify for Medicaid, but can afford a health plan, losing your job is a life event that allows you to buy a health care plan through healthcare.gov via your state exchange. You might also qualify for financial assistance. Use the Kaiser calculator to determine if that is the case.
12 states are allowing open enrollment independently of a life event: California, Colorado, Connecticut, Maryland, Massachusetts, Maryland, Minnesota, Nevada, New York, Rhode Island, Vermont, and Washington
Did I miss something? I will keep updating this page. Feel free to email me if you’d like more info on anything, if you have comments, or if you have anything that you believe I should add.
Disclaimer: This does not represent the views of the Board of Governors of the Federal Reserve System, any insurance programs, any state, or pretty much anybody. This was written as an informational piece.