In order to safely reopen businesses, many employers plan to use COVID-19 testing to ensure that employees who are physically present in the workspace are healthy. Absent a vaccine or widespread immunity, COVID-19 carrier screening of asymptomatic individuals will be necessary to protect workplace safety. Employers that recommend or require (e.g., per collective bargaining agreements) this testing should first decide how the cost for this testing will be paid and consider whether the source of payment limits the employer’s access to the test results.
Paying for the Asymptomatic Carrier Test. Employers may expect that the cost for this testing will be covered or subsidized by the group health plan in which employees participate. However, employers need to consider whether screening of asymptomatic individuals is covered under the group health plan; otherwise, employees may receive surprise medical bills related to the test.
Some providers have advertised COVID-19 testing as “free” to individuals due to the federal requirements for group health plans and issuers to cover 100% of the cost of diagnostic testing. In other words, the employee pays nothing out‑of‑pocket for diagnostic COVID-19 testing. However, what is covered by this “free” testing is limited. Group health plans and issuers must only cover 100% of the cost of any FDA‑approved diagnostic testing and test administration for the diagnosis of COVID-19.1 This may not include asymptomatic carrier testing.
Also, who is eligible for this free testing is limited. Guidance issued jointly by the U.S. Departments of Labor, Health and Human Services, and Treasury states that COVID-19 testing must be covered without cost‑sharing only “when medically appropriate for the individual, as determined by the individual’s attending healthcare provider in accordance with accepted standards of current medical practice.”2 As a result, group health plans and issuers offering group health insurance are not required by federal law to cover, at no cost, asymptomatic carrier testing.
While states could mandate free asymptomatic carrier testing, such a state law would only apply to issuers of group health insurance because self-funded plans could argue that ERISA preemption relieves them of the obligation to comply. Absent a federal law, self-funded group health plans and issuers can deny coverage for claims related to asymptomatic carrier testing.
Employers that would like to cover testing of asymptomatic employees at no cost through their group health plan should first check with the self-funded plan administrator or fully insured plan carrier to determine if the asymptomatic carrier testing would be covered, how claims would be administered, and what employees could be expected to pay for the test. Employers may amend self-funded plans to cover asymptomatic testing, and at no cost to employees. Amending a multiemployer plan to cover these tests may require not only a plan document amendment but also an amendment to collective bargaining agreements. Employers with fully insured plans need to negotiate the coverage of asymptomatic testing with the insurer.
Employer Access to Test Results. The privacy restrictions under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) apply to protected health information related to COVID-19 that is created, maintained, received or transmitted by the group health plan. This means that medical care received under a group health plan cannot be freely obtained by an employer. The only way an employer could get the information would be if an employee voluntarily provided it (and, by law, an employer cannot require release of the test result as a condition of ongoing employment or reemployment). In contrast, if the employer pays for the test out of its general assets so that the test is conducted as part of the course of employment, the test would be outside of HIPAA and the employer would have access to the test results (subject only to generally applicable privacy considerations).
Information is changing daily and some of the content included in this alert may have changed or been updated since publication.
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1 Section 6001(a) of the Families First Coronavirus Response Act.
2 See FAQ 6 of the FAQs about Families First Coronavirus Response Act and Coronavirus Aid, Relief, and Economic Security Act Implementation Part 42. Issued April 11, 2020.