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Health Plan and Insurer Coverage for Over-The-Counter COVID-19 Testing

Effective January 15, 2022, medical plans (both insured and self-insured) will be required to cover over-the-counter or at-home COVID-19 tests (“OTC COVID-19 Tests”) without imposing cost-sharing requirements.  This requirement for medical plans to cover OTC COVID-19 Tests was contained in guidance issued on January 10, 2022 by the Departments of Labor, Health and Human Services, and the Treasury, and expands on the existing requirements under Section 6001 of the Families First Coronavirus Response Act (“FFCRA”) that medical plans provide coverage for certain items and services related to COVID-19 testing without imposing any cost-sharing requirements. 

This new guidance provides for the following:

  • Medical plans are required to reimburse participants for OTC COVID-19 Tests without imposing any cost-sharing requirements, prior authorizations, or other medical management requirements. For example, the coverage of OTC COVID-19 Tests may not be limited to situations in which the individual has an order or individualized clinical assessment from a health care provider. However, OTC COVID-19 Tests not primarily intended for individualized diagnosis or treatment of COVID-19, such as testing required for employment purposes, are not covered;

  • Medical plans are strongly encouraged, but not required, to directly reimburse sellers of OTC COVID-19 Tests (known as “Direct Coverage”). Medical plans may also require the participant to submit a claim for reimbursement for the purchase of an OTC COVID-19 Test; and

  • Medical plans may limit each participant, beneficiary, or enrollee to eight (8) OTC COVID-19 Tests per 30-day period (or per calendar month). For example, the guidance states that a family of four could obtain up to 32 OTC COVID-19 Tests per 30-day period.  For packages containing multiple tests, medical plans may count each test in one package separately towards the limit. This limit does not include OTC COVID-19 Tests administered with a provider’s involvement or prescription. 

Medical plans may not limit coverage of OTC COVID-19 Tests to preferred pharmacies or retailers. However, medical plans may limit reimbursement for OTC COVID-19 Tests from non-preferred pharmacies or retailers to the lesser of the actual price or $12 per test. For packages containing more than one test, the medical plan must calculate the reimbursement based on the number of tests in a package. Medical plans providing Direct Coverage must take reasonable steps to ensure an adequate number of retail (in-person and online) locations are available to participants. 

Medical plans may take reasonable steps to ensure that OTC COVID-19 Tests are purchased for a permissible purpose (i.e., individualized diagnosis or treatment of COVID-19), but may not create significant barriers to obtaining the tests. For example, it is not reasonable for a medical plan to require the participant to submit multiple documents or involve numerous steps which delay the access to or reimbursement of OTC COVID-19 Tests. The guidance provides the following as reasonable steps to address fraud and abuse:

  • A medical plan may require an attestation by the participant that the OTC COVID-19 Test was purchased by the participant for their own (or their beneficiary’s) personal use and not for employment purposes, will not be reimbursed by another source, and is not for resale;

  • A medical plan may require reasonable documentation of proof of purchase with a reimbursement claim, such as the receipt of purchase and the UPC code of the OTC COVID-19 Test to verify that the item is covered under the FFCRA.

  • Observation:  These permitted fraud and abuse techniques essentially create a default rule whereby OTC COVID-19 Tests will be covered unless the medical plan requires an attestation regarding intended use.

Medical plans must notify participants and beneficiaries of key information needed to access OTC COVID-19 Tests, such as dates of availability for any Direct Coverage program, participating retailers, or reimbursement claims processes. These requirements go into effect on January 15, 2022 and extend through the end of the public health emergency relating to COVID-19.  Although the guidance does not provide a specific time frame within which such information is required to be provided to participants and beneficiaries, because of the imminent effective date of the new coverage requirements, employers should promptly address coverage of OTC COVID-19 Tests and corresponding notices with their insurers and/or third-party administrators to ensure compliance with the guidance. 

© 2023 Vedder PriceNational Law Review, Volume XII, Number 14

About this Author

Christopher T. Collins, Vedder Price law Firm, Labor Employment Attorney

Christopher T. Collins is a member of the Employee Benefits Group.  He assists employers on all aspects of employee benefits, focusing on retirement and welfare plan design, qualification and compliance.  He frequently advises employers regarding benefit issues in connection with mergers and acquisitions and Department of Labor and Internal Revenue Service correction programs.  Mr. Collins also represents companies and executives in the design and negotiation of executive compensation arrangements, such as nonqualified deferred compensation plans and equity compensation plans.

Philip L. Mowery, Vedder price law firm, Labor Employment Attorney

Philip L. Mowery joined the Chicago office of Vedder Price in the Employee Benefits Group in 1988 and became a shareholder in 1995. He counsels a variety of corporations in the manufacturing and service industries on all aspects of employee benefits law, including the design, tax qualification, legal compliance, interpretation and communication of employee benefit plans. He also counsels employers and executives in the negotiation and implementation of executive compensation agreements and programs. Finally, he represents management and plan fiduciaries in employee benefits litigation. He...


Amal Rafiq is an Associate in Vedder Price’s Washington, DC office and a member of the firm’s Executive Compensation & Employee Benefits group.

Ms. Rafiq assists with retirement and health and welfare plan qualification and compliance. She has experience preparing and updating plan documents, preparing regulatory filings, reviewing service agreements, and assisting with day-to-day administrative issues. 

Prior to joining the firm, Ms. Rafiq represented multi-employer funds on the management side. She represented...