What The Families First Coronavirus Response Act Means for Payers

The Families First Coronavirus Response Act, the second relief package for the coronavirus pandemic, passed on March 18 with an overwhelming majority in the House and Senate. The act extends coronavirus coverage for free testing to Medicaid beneficiaries and group health insurance plans.

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“Today, the Senate has joined the House to pass our Families First Coronavirus Response Act: strong, bipartisan legislation that protects the health, economic security and well-being of the American people while stimulating the economy,” House Speaker Nancy Pelosi said in a statement when the bill passed in the House. 

The Senate passed the bill without any changes. The provisions have implications for private and public payers as well as the uninsured, who are widely considered the most vulnerable population in the pandemic.

For private payers offering group health plans or individual health insurance, the bill mandates coverage with zero cost-sharing for coronavirus testing. This includes deductibles, copayments, and coinsurance for items and services provided during a provider visit, whether it is in-person, telehealth-enabled, at an urgent care center, or in an emergency room. It also waives prior authorization and other “medical management requirements.”

The coverage applies both to the test itself and to the visit in which the test was administered.

Medicaid is also required to cover all testing and the federal government will provide funds to do so. According to the American Action Forum, a right-leaning think-tank, by roughly estimating the costs of each provision, the federal government is promising approximately $1.3 billion in federal healthcare spending for testing and around $56.3 billion for other Medicaid costs.

While many call the bill a commendable “first step,” experts have pointed out some deficiencies to be worked out in follow up legislation.

“This is a time for urgent bipartisan action, and in this case, I do not believe we should let perfection be the enemy of something that will help even a subset of workers,” said Senate Majority Leader Mitch McConnell prior to voting to pass the bill. “However, the House’s bill has real shortcomings.”

He continued by decrying the gaps in coverage that the bill leaves in place for some Americans and the lack of support the bill supplied small businesses that would be required to provide paid leave.

Health Affairs researchers confirmed these coverage gaps. They pointed out that students have been left out of the bill and that short-term health plans’ coverage requirements have not been thoroughly addressed. Policymakers should also give greater consideration to the incarcerated populations and other such institutions, the researchers stated.

Furthermore, while this bill covers testing, many Americans will find themselves unable to afford the treatment that follows testing. Experts emphasized that more support is needed beyond simply identifying the presence of the disease.

Medicaid expansion has been perceived, even by CMS, as a method for controlling the costs of this pandemic. The Health Affairs experts took up this position as well and suggested the federal medical assistance percentage (FMAP) should be raised to 100 percent for states that choose to expand their Medicaid programs as an incentive.

Most stakeholders—from researchers to politicians—emphasized that this is merely the second step in a long process of responding to the crisis. They stressed that follow up legislation will be used to iron out the insufficiencies of the Families First Coronavirus Response Act. 

“The House and Senate are already hard at work on the third bill in the House’s Families First agenda, which will take bold, historic action on behalf of America’s workers and families,” Speaker Pelosi wrote in her statement. “This bill will be crafted in consultation with the public health, labor, non-profit and business communities, so that we can deliver the most effective, evidence-based response.”