This week, nearly two full years into the on-going pandemic, the Biden Administration told Americans that they would, at long last, be given access to free, rapid COVID-19 tests — a key tool in containing the spread of the virus.
The government’s plan was two-fold. First, on Jan. 15, federal agencies implemented new rules requiring private health insurers to cover at-home tests. And second, on Jan. 18, the feds launched a new website to deliver free rapid antigen tests directly to Americans’ homes.
The effort was a major step in the right direction, public health experts say. But it has also been kludgy, overly-complicated—and it doesn’t go nearly far enough, they say.
“It’s a well intentioned effort to try to give people some financial relief,” says Sabrina Corlette, a research professor and co-director of Georgetown University’s Center on Health Insurance Reforms. “But I think it is a highly inefficient, cumbersome and confusing way to go about it.”
The new federal rules require private insurers to pay for eight tests per person each month, people have to get them at specific locations to have their costs covered up-front, and those new rules don’t apply to the tens of millions of people who are on Medicare, Medicaid or are uninsured.
The federal website, for its part, won’t ship antigen tests for 7-12 days — too late to address the spike in new cases this week — and the program is limiting orders to four tests per household, which is hardly enough for people, including frontline workers and caretakers, who need to test regularly.
Cumbersome and confusing
The White House unveiled its plan in December to compel insurers to cover the tests, but Department of Health and Human Services didn’t release detailed regulations until Jan. 10—just days before they were set to kick in.
Many insurers, which don’t currently have billing codes assigned to at-home Covid-19 tests and aren’t used to either processing retail receipts or sending physical checks for reimbursement, scrambled to formulate new plans this past week. Many published FAQs and posted links to downloadable forms, but each insurer is handling the situation differently, leading to a confusing blizzard of new forms, requirements, and protocols.
Customers, for their part, are finding the process bewildering. Social media lit up with people complaining about their insurers’ forms or asking for advice on how they could actually get their “free” COVID-19 tests. A Kaiser Family Foundation analysis of the 13 private insurers with at least 1 million fully insured members found that most of the top plans require customers to print and mail in physical forms if they want to be reimbursed for their COVID-19 test, one offered the option to submit its form via fax, and just three offered an online option.
Ceci Connolly, president and CEO of the Alliance of Community Health Plans, which represents small nonprofit insurers, predicts a nationwide “shoe box effect” — people “are going to be collecting and hanging on to all of these paper receipts, and one day, stuffing them in an envelope and putting them in the mail,” she says. “That raises all kinds of questions about the authenticity. Who used this test kit? Was it a covered member? How many did they have in a given period of time? Just endless practicality questions.”
That’s not good for insurers. But it’s also not good for public health. Research has repeatedly found that adding costs and other burdens actively discourages people from getting the care they need. Even small costs, such as a $10 increase for prescription drugs, can make patients less likely to take their medications, a study last year found. Half of U.S. adults say they skipped or put off health or dental care in the last year due to the cost, according to the Kaiser Family Foundation’s 2021 Employer Health Benefits Survey.
Jumping through hoops
Under the new federal rules, insurers are encouraged to set up networks of “preferred” pharmacies or retailers where customers can get the costs of their at-home tests covered up front. If people go to a different pharmacy or website to buy a test, they have to pay out of pocket, then submit their receipts and additional paperwork for reimbursement in the future. In that case, insurers must reimburse up to $12 per test, so if people spend more — and the costs range from $17.98 for a pack of two to $50 for a single test at various retailers — they’re likely out of luck. (If an insurer doesn’t designate “preferred” pharmacies, then it’s on the hook for the whole cost of the test.)
Several of the top insurers are also requiring customers to submit the bar code on the rapid test’s box along with their receipt, so Jenny Chumbley Hogue, an insurance broker in north Texas, has recommended all of her clients keep both their receipts and their test boxes. But she says these kinds of instructions are likely to discourage people from following through.
“In essence telling somebody to file a paper claim means either A they’re not going to get [the test] or B they’re not going to file it,” Chumbley Hogue says.
Another wrinkle in the new system is that some insurers, including Humana, Blue Cross Blue Shield of Texas and Premera Blue Cross in Washington, are putting other limits on how the rapid tests can be used, requiring customers to attest that they will not use the tests for purposes such as travel, “recreation,” “entertainment” or “school.”
“For a lot of people who might want to buy tests and keep them in their medicine cabinet for a future use, does that process give you a little bit of pause?” says Corlette. “People might think, what if I have to use this for my kid to make sure he can go to school? Am I now at risk of insurance fraud?”
With all of these hurdles, it might seem easier to stick with the “preferred” pharmacy chosen by your insurance company. But at least during the first week of the new plan, many insurers have yet to set up arrangements with pharmacies or other retailers. Some of the major insurers have announced agreements. United Health Care, for example, lists Walmart, Sam’s Club, Rite Aid and Bartell Drugs as “preferred retailers.” But other plans have fewer options or say they will update members soon.
While the paperwork and supply issues get worked out, Chumbley Hogue recommends her clients use drive thru testing sites or make appointments to get tested at a pharmacy, where testing was already covered by insurance.
Connolly says that the smaller nonprofit plans she represents are having trouble finding pharmacies that want to partner with them. But the biggest issue, she says, is that there is still a shortage of tests around the country. Even if health plans strike a deal with a pharmacy or direct members to a retail location, the store is frequently out of stock.
“We’re very worried that consumers are going to get frustrated,” she says. “And then you might just have more of that boomerang effect where somebody tried to get tests, they couldn’t and so then they stop.”