A Blog by Jonathan Low


Jan 11, 2022

US Says Insurers Must Pay For Home Covid Tests As Volume Backs Up Labs

This may encourage demand and thus the production of more tests. 

In the meantime, the omicron surge is causing delays in getting test results as labs are overwhelmed and some are giving priority to those with symptoms. JL 

Brianna Abbott and Stephanie Armour report in the Wall Street Journal:

Private insurers will have to cover the cost of over-the-counter Covid-19 tests starting Saturday under a Biden administration plan that aims to make it more affordable for people to screen for infections and limit the spread of the Omicron variant. Millions of people with private health insurance can expect insurers to reimburse them for up to eight tests a month per covered individual, or that they will be able to purchase them at no cost through their insurance. (Meanwhile) escalating demand for Covid-19 tests is prompting laboratories to ration access, giving priority to people with symptoms or other health concerns

Private insurers will have to cover the cost of over-the-counter Covid-19 tests starting Saturday under a Biden administration plan that aims to make it more affordable for people to screen for infections and limit the spread of the Omicron variant.

The policy outlined Monday by the administration means that millions of people with private health insurance can expect insurers to reimburse them for up to eight tests a month per covered individual, or that they will be able to purchase them at no cost through their insurance.

Consumers with private insurance will be able to obtain the tests without any cost sharing such as deductibles, coinsurance or copayments, according to the new policy. A family of four, all on the same health plan, would be able to be reimbursed by their insurance for 32 tests a month, for example.

The Biden administration is encouraging insurers and group health plans to set up partnerships with specific retailers and pharmacies so people can get free over-the-counter tests directly, without paying anything upfront or having to submit a claim for reimbursement.

If insurers set up such programs, they would still be required to reimburse people for tests purchased outside of those networks, but the reimbursement rate would be limited to $12 a test. A person would have to pay the difference if they buy a test outside their insurer’s network, such as through an online retailer, and if the test costs more than $12.

Right now, many over-the-counter tests cost around $12 a test, in a two-pack for about $24, but some cost more.

Consumers can find out from their plan or insurer if it provides direct coverage of over-the-counter Covid-19 tests or whether they will need to submit a claim for reimbursement, officials said. The new policy doesn’t apply to Medicare, with its more than 60 million seniors who are generally at higher risk of severe infection because of their age. Medicaid already covers at-home Covid-19 tests that have been authorized by the Food and Drug Administration.

Some insurer groups said Monday that the administration should have done more sooner to make testing available and affordable.

“The lack of a coordinated national testing strategy two years into this public health emergency leaves too many communities without the resources necessary to mitigate this virus,” said Ceci Connolly, president and chief executive of the Alliance of Community Health Plans, which represents nonprofit health plans.

She said the policy released Monday didn’t address big problems facing widespread use of at-home tests, including a lack of availability at pharmacies and retailers, and delays in shipping tests.

Other insurer groups, however, were more supportive of the changes.

“We recognize that the Administration’s guidance takes steps to mitigate the real risks of price gouging, fraud, and abuse,” Matt Eyles, president and chief executive officer of America’s Health Insurance Plans, a national association of healthcare coverage providers, said in a statement. “Health insurance providers will work as quickly as possible to implement this guidance in ways that limit consumer confusion and challenges.”

Shortages of at-home tests amid the spread of the Omicron variant have resulted in complaints to the government of some retailers raising prices, as people search for tests they need to return to work and school. Some families have said they spent hundreds of dollars on tests in recent weeks.

Making diagnostic tests more abundant and affordable is critical for curbing the spread of Covid-19 because people who are identified as infected quickly can isolate and help reduce transmission, as well as potentially get treatment, public health leaders say. The virus can lead to asymptomatic or mild infections in which people are unaware they could pass Covid-19 on to others, even among individuals who are vaccinated and have gotten booster shots. People can also be infectious before they develop noticeable symptoms.

Sabrina Corlette, co-director of Georgetown University’s Center on Health Insurance Reforms, said the new insurance requirement will enable more people to get tests.

“This policy will help millions of families afford Covid tests that allow them to be in school, visit family members and live their lives,” she said. “It’s not perfect, and there will be glitches, but the cost of these tests has been a huge barrier for many people, and this policy helps lower that.”

‘Five hundred million is not really enough given the surge in cases.’

— Larry Levitt of the Kaiser Family Foundation

Dr. Corlette added that consumer education, including making people aware of what they are eligible for and their insurer’s specific process, is going to be critical. The ease of the reimbursement process will also likely come down to individual companies. “Confusion I think is going to be inevitable,” she added.

Currently, insurers have been covering tests that are prescribed, administered, analyzed or in some other way involving a clinician. There isn’t a limit to the number of tests, including at-home tests, that must be covered by insurers when they are ordered or administered by a health provider, officials said.

The new policy falls under 2020 Covid-19 legislation that requires group health plans to provide Covid-19 testing with no cost sharing, administration officials said. The administration is not providing funds to insurers to reimburse them for over-the-counter testing costs.

The administration also is expected to soon introduce a new website where people can request free tests be mailed to them. U.S. officials are seeking to distribute 500 million free at-home tests starting this month.

That could still fall short of the anticipated demand, according to some health-policy analysts.

“Five hundred million is not really enough given the surge in cases,” said Larry Levitt, executive vice president for health policy at the Kaiser Family Foundation.

The Food and Drug Administration recently granted authorization to two large manufacturers to sell their over-the-counter tests in the U.S., and public-health and diagnostic experts anticipate that supply will increase in the coming weeks.

The new coverage requirements are outlined in guidance from the Labor Department and the Department of Health and Human Services’ Centers for Medicare and Medicaid Services.

The administration will hold a call Tuesday with insurers about the requirement, according to a person familiar with the planning.



Escalating demand for Covid-19 tests is prompting some laboratories to ration access, giving priority to people with symptoms or other health concerns as the Omicron variant quickly spreads.

Triaging who is eligible for Covid-19 tests can help ensure that patients who need a test the most get results fast enough to isolate or get treatment, pathologists and public-health experts say. The strategy, however, risks perpetuating the virus’s spread if some people get turned away from testing altogether.

“What we don’t want is for people to not be able to get tested in the community and then show up at the ER to get testing,” said Melissa Miller, director of the University of North Carolina’s microbiology lab. “But there is a maximum amount that you can collect in a day.”

UNC is restricting tests to people with Covid-19 symptoms, employees and patients who need a test before surgeries. Dr. Miller said UNC is running about 1,200 tests a day and returning results to patients within 24 hours. About a third of the tests are coming back positive, she said.

The University of Washington temporarily closed some of its testing sites on Tuesday and is giving appointment priority to people with Covid-19 symptoms or a known exposure. The turnaround time for test results had stretched past two days, beyond the university’s 24-hour goal, said Geoffrey Baird, UW Medicine’s acting chair of Laboratory Medicine and Pathology, at a Dec. 30 media briefing.

“A Covid test that is not back for several days, it just isn’t terribly meaningful because someone could go on and spread the virus,” Dr. Baird said.

Dr. Baird also said the proportion of test results coming back positive is too high to take advantage of a common resource-saving technique. UW Medicine often uses a single test on multiple patient samples at once, a process called pooling, which saves time and resources when most samples are negative. But pooling doesn’t work if too many samples are positive because lab workers often have to retest the batches to find the positive results.

For pooling to be effective, the positivity rate needs to be as low as 10% to 15%, Dr. Baird said. At UW Medicine, the overall positivity rate was about 25%, with some sites exceeding 40%, around Dec. 30 and continues to increase. “We can’t do pooling anymore, and what it does is it really decreases our capacity,” Dr. Baird said.

The Carle Foundation Hospital Laboratory in Illinois ran about 13,000 Covid-19 PCR tests within the week ending Jan. 1, up from about 6,700 at the beginning of November. The lab could run around 18,000 tests a week if it had enough staff and supplies, said Bruce Wellman, a pathologist. The lab recognizes it could need a triage strategy for its drive-through sites if demand outpaces capacity, Dr. Wellman said.

“We’ve got the choice of delayed results, which have no value, versus timely, immediate results, which do have value,” he said.

Even before the Omicron wave put many people out sick or into quarantine, laboratories were chronically understaffed and heading into their third year of pandemic operations.

“There are a finite number of people who do laboratory testing. It’s not an endless resource,” said Emily Volk, president of the College of American Pathologists.

Dr. Volk said that staff at Baptist Health Floyd in Indiana, where she is chief medical officer, worked over the holidays to process tests and that processing time for samples remained low. Many hospital and commercial labs are running around the clock, with staff there to process samples at all hours.

Testing materials including reagents and swabs are more readily available than earlier in the pandemic, Dr. Volk and other diagnostic experts said. But some labs have started to report challenges in getting materials in recent days because of increased demand.

Laboratories in the U.S. were processing about 1.7 million Covid-19 tests a day as of Jan. 3, according to federal data, comparable to the number processed during last winter’s surge.

Many mass-testing sites were closed or converted into vaccination sites within the past year. Fewer locations and staff for collecting samples have contributed to hourslong lines and limited testing appointments across the country.

Some states and cities have established new sites in recent weeks and federal officials said last week that they would add locations in several states and Washington, D.C. The Centers for Disease Control and Prevention said laboratories that can help collect samples or conduct drive-through testing should contact local health officials.

Some laboratories say they are still processing PCR tests in one to two days, including Laboratory Corp. of America Holdings. Quest Diagnostics Inc. on Tuesday said it expected turnaround times of two to three days, up from a day. The company is using its own air fleet and logistics network to balance sample volume across two dozen Covid-19 testing labs and is sending some excess samples to external laboratories.

CityMD, which operates urgent-care centers throughout New York and New Jersey, said it is averaging five to seven days to deliver PCR test results and has temporarily closed more than 30 of its 150 locations because of staffing concerns. CityMD said it plans to reopen 12 sites on Monday and then more on Jan. 17, contingent on availability of workers.

Over-the-counter, at-home tests have helped ease pressure on laboratories, but they have been in short supply. The Indiana Department of Health said Tuesday that rapid tests at state and local sites would only be available to people under age 18 or symptomatic adults 50 and older as a result of high demand and a national shortage. PCR tests are still available at all sites, the department said, with results expected in two to three days.


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