Top Challenges, Benefits of At-Home Coronavirus Testing Coverage

In the first quarter of 2022, payers witnessed significant changes in at-home coronavirus testing coverage with mixed reactions. These changes—and the influence of the coronavirus pandemic on preventive care—present both opportunities and challenges for health plans.

Leaders in the healthcare industry applauded the CMS decision to expand seniors’ access to over-the-counter coronavirus tests.

“We know that testing is critical for slowing the spread of coronavirus and when you are thinking about public health, the government has a very important role to play. So we appreciate that this administration has continued to see the importance of public health measures by the government and that the private sector then stepped in and does its part,” Ceci Connolly, president and chief executive officer of the Alliance of Community Health Plans (ACHP), told HealthPayerIntelligence.

Providing an avenue for access to over-the-counter coronavirus tests through Medicare could relieve some of the financial pressure on community health plans to fund these tests, Connolly indicated.

ACHP member plans tend to have small margins of one to two percent—or less. While the payers advocate for more testing, particularly for seniors and other at-risk populations, covering this service for free can drain a community health plan’s limited resources. 

Thus, Connolly said that many health plans welcomed Medicare coverage for this preventive care service.

Although many payer organizations voiced their support for Medicare coverage of over-the-counter coronavirus testing, certain challenges have persisted, challenges that have been present since the early days of coronavirus testing.

First, supply chain issues have not abated. 

When CMS announced that it would require commercial health plans to cover over-the-counter coronavirus tests, the announcement raised a common outcry among payers, who pointed to the lack of at-home tests that were available due to supply chain issues.

In early January 2022, shortly before CMS made its announcement regarding commercial health plans, the national over-the-counter testing supply was suffering. In eight days, 91 percent of the testing opportunities across six at-home test carriers were unavailable.

Approximately three months later in April 2022, Connolly acknowledged that the situation might continue to impact consumers’ access to at-home coronavirus tests, with or without Medicare coverage. 

The unpredictable nature of the coronavirus has hindered experts’ ability to project demand for at-home coronavirus testing. Adding to the stockpile might help reduce the urgency around limited supplies, but at present, there is no way to anticipate at-home coronavirus testing trends confidently. 

This will continue to be a problem even as Medicare extends coverage to eight at-home tests per month.

The second hurdle that will continue to have an impact despite Medicare coverage of at-home coronavirus testing is price gouging.

“Price gouging and fraud taking place in the context of this pandemic is outrageous,” Connolly said.

The payer industry was alert to coronavirus test price gouging a couple of months into the pandemic. The in-network cost for a coronavirus test was $130, but providers would tack on another $55 or more for an out-of-network coronavirus test, an AHIP study found. Around nine to sixteen percent of out-of-network coronavirus tests had a price tag of more than $390.

Almost two years later, AHIP’s calls for more decisive action against coronavirus test price gouging persist. 

In a letter to Congress, the organization has called on CMS to create Healthcare Common Procedure Coding System (HCPCS) billing codes in order to curb price gouging for at-home coronavirus tests, along with other recommendations for coronavirus testing more broadly.

Connolly commended state and federal regulators as well as some pharmacy benefit managers (PBMs) who were quick to react whenever ACHP flagged cases of fraud or price gouging.

But typically, payers have already lost a significant amount of money by the time they discover either of these practices. Thus, instances of price gouging and fraud remain costly for payers.

“It can take a while for those claims to start building up and for someone to notice some sort of a disturbing pattern. And so you end up playing a bit of catch up, and that's definitely one of the big unknowns that our community health plans are worried about from a cost perspective this year,” Connolly acknowledged.

Looking beyond these immediate challenges, the coronavirus pandemic has forced key shifts in the preventive care space.

Connolly said that one of the positive outcomes of the pandemic was the increased partnership between the public and private sectors. 

Individuals can receive coverage for coronavirus testing from three primary sources: their payers, the government, or their employers. If the reason for testing is diagnostic or medical, the payer covers the cost. If it is for public health surveillance, the government reimburses for it. And if it is required for work, the employer pays the bill.

“That's the philosophy of shared responsibility that we liked so much, and I think that should continue going forward,” Connolly said.

In addition to creating a more cohesive relationship between the public and private sectors around preventive care coverage policies, the coronavirus pandemic has reshaped preventive care services in historic ways. 

The public is far more conscious of the value of preventive care, Connolly noted. This heightened understanding could influence trends in chronic disease prevention, such as diabetes.

“Health plans are thrilled that the rest of the country, the public, is now understanding and appreciating the value of prevention and wellbeing and screening,” said Connolly. “Plans have long been proponents of those things because we all know that means better health later and lower costs.”

Additionally, during the coronavirus pandemic, consumer demand for convenience in preventive care became more apparent and more urgent. The healthcare industry answered these demands with at-home testing, hospital-at-home care, remote patient monitoring, virtual care, telehealth, and more. 

That demand will not end with the public health emergency. As the coronavirus pandemic becomes more manageable, Connolly stressed that healthcare payers and regulators will have to keep pace with the consumer appetite for accessible, convenient preventive care options.

“Consumer expectations have changed dramatically,” Connolly said. “We live the rest of our lives on our digital devices. Both the health sector and regulators need to quickly catch up, so that we can all do a better job of serving consumers and helping them stay healthy and well.”

In terms of future policymaking around at-home coronavirus testing coverage, Connolly emphasized that policymakers need to give health plans time to adjust to new regulations. 

Due to the actuarial processes of the health insurance industry, major expenses that crop up during the middle of the year can cause a significant disruption. By giving health plans a year or two years’ warning about a shift in policy or coverage, policymakers allow payers to make the necessary arrangements and cost projections.

In the context of a pandemic that is constantly evolving and creating new variables, that extra time can be even more crucial.

Payers will need to remain attuned to policymakers’ agendas and continue to dialogue with government regulators to be prepared for the future of coronavirus testing coverage when the public health emergency ends.