AHIP Calls On Congress to Address Price Gouging of COVID-19 Tests

AHIP is urging Congress to take action and address the ongoing price gouging of COVID-19 tests that payers are facing from out-of-network providers.

In a statement submitted to the House Committee Energy and Commerce Subcommittee on Consumer Protection and Commerce, AHIP highlighted how the organization is committed to ensuring that all Americans have access to affordable vaccines, tests, and treatments for COVID-19, but added that price gouging remains a significant problem.

The passing of the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020 required payers to reimburse out-of-network providers for COVID-19 tests at the amount the providers listed on their websites. This left no room for payers to negotiate lower prices, AHIP argued.

AHIP has called on Congress to implement several changes to curb price gouging during the coronavirus pandemic.

First, the organization recommended that Congress amend the CARES Act by eliminating the requirement for payers to reimburse for out-of-network COVID-19 tests at the amount posted by the provider.

Instead, legislators should allow payers to reimburse out-of-network providers at the provider’s median in-network rate for COVID-19 tests. According to AHIP, this would ensure that premiums remain affordable, patients are protected from balance billing, and providers receive fair rates.

Next, AHIP asked Congress to direct the Centers for Disease Control and Prevention (CDC) to release guidance that allows providers to use the ICD-10 code for COVID-19 screening tests.

The ICD-10 code helps differentiate between diagnostic and screening tests. This is important when it comes to coronavirus testing coverage as the CARES Act requires payers to only cover diagnostic tests that are for medical decision-making. The CDC has created the code but has not yet authorized its use.

Allowing providers to use the code would help payers distinguish between diagnostic tests and tests that people receive for attendance clearance at school or work, for travel, or other non-medical reasons. Payers could implement new testing policies that coincide with federal coverage regulations if they could differentiate between testing types, AHIP said.

AHIP’s final recommendations related to at-home COVID-19 tests.

CMS recently announced that all commercial health insurers are required to cover the costs of at-home COVID-19 tests. This prompted positive feedback from payers, as this testing route could potentially help limit price gouging. Medicare will also start covering over-the-counter tests in the spring of 2022.

AHIP recommended that Congress direct CMS to create Healthcare Common Procedure Coding System (HCPCS) billing codes for at-home tests in order to develop a better system for tracking the tests.  

“Health insurance providers need the ability to track claims for OTC COVID-19 tests to identify tests purchased under the requirement, reconcile against quantity limits, as well as monitor the supply chain, for fraud and abuse, and for equitable access,” AHIP wrote.

Finally, AHIP encouraged Congress to continue to provide federal funding for at-home COVID-19 tests. The Biden Administration recently announced that every household across the country could order four free at-home tests. AHIP urged Congress to expand the program to ensure that this access will continue for all Americans throughout the pandemic.

“Health insurance providers are committed to working with Congress to pass legislation that eliminates price gouging and sets a reasonable market-based pricing benchmark for out-of-network COVID-19 tests, allows for appropriate tracking of tests administered and makes OTC tests universally available,” AHIP concluded.

“We look forward to working with the Committee to build on our health care ecosystem, improve what is working, fix the gaps, and establish patient protections so that Americans can go about their daily lives safely.”

AHIP has been heavily involved in the conversation around coronavirus testing and has been opposing price gouging practices for out-of-network COVID-19 tests as early as November 2020. An AHIP survey revealed that 47 percent of all out-of-network diagnostic testing cost more than $185, exceeding the $130 average cost of in-network tests.  

Additional data from AHIP found that price gouging of COVID-19 tests was still a problem as of July 2021, with 54 percent of all out-of-network tests exceeding $185.