Here, we provide a brief overview of the state of the PHE, followed by a discussion of expected changes in Medicaid enrollment, COVID-19 testing and related items and services and telehealth services.
The state of the PHE
HHS first declared a PHE due to COVID-19 on January 31, 2020, and it has renewed the PHE every 90 days throughout the Trump and Biden administrations to date. On January 30, 2023, the Biden administration informed Congress that it will end the PHE on May 11.
Expected drop in Medicaid enrollment
The Families First Coronavirus Response Act (FFCRA), one of two signature pieces of federal COVID-19 legislation, increased funding to states for Medicaid so long as the state met certain requirements. One of those requirements is that the state maintain enrollment for those who were eligible for Medicaid as of January 1, 2020, for the duration of the PHE. Ordinarily, individuals must renew their Medicaid coverage annually and show that they meet income and other eligibility requirements. However, under the FFCRA, states receiving extra federal funds through the FFCRA cannot disenroll Medicaid recipients during the PHE so long as the recipient was eligible as of January 1, 2020, is still a state resident, and has not voluntarily left the program. HHS estimates that this “continuous enrollment condition” led Medicaid enrollments to increase by more than 19 million individuals, or nearly 29 percent, during the pandemic.
Through its most recent spending package, Congress has accelerated the end of these provisions. Under the legislation, states may begin processing Medicaid redeterminations of eligibility as soon as April 1. In addition, the enhanced federal funding called for by the FFCRA will phase down between April and the end of 2023. As a consequence of these changes, HHS estimates that up to 15 million people will be disenrolled in the Medicaid program, including nearly 7 million who remain eligible but nevertheless will be disenrolled due to bureaucratic hurdles.
While Medicaid managed care organizations (MCOs) should prepare for a decline in enrollment, MCOs can assist state Medicaid agencies in communicating to enrollees about the end of the continuous enrollment condition to improve coverage and member retention. Outreach and assistance to both state agencies and members is essential to minimizing disenrollment for eligible members.
COVID-19 testing and related items and services
The FFCRA and Coronavirus Aid, Relief, and Economic Security (CARES) Act, the second signature federal COVID-19 legislation, dramatically expanded access to COVID-19 testing and related items and services. Under the FFCRA and CARES Act, for the duration of the PHE, plans and issuers must cover: (1) diagnostic COVID-19 tests approved by the Food and Drug Administration (including under emergency use authorization) or otherwise authorized by a state or HHS; and (2) “items or services furnished to an individual during” an office, clinic, or ER visit that results in an order for a COVID-19 diagnostic test, “but only to the extent the items and services relate to the furnishing or administration of the [test] or to the evaluation of the individual for purposes of determining the need of the individual for such [test].”
Plans must cover such tests and related items and services without imposing cost sharing, prior authorization, or medical management requirements. Federal guidance also clarified that plans should generally find COVID-19 diagnostic testing is medically necessary – even if the individual is asymptomatic and has no known or suspected exposure to COVID-19 – so long as an authorized health care provider ordered the test. And in subsequent guidance, HHS and other agencies made clear that plans must cover authorized over-the-counter COVID-19 tests, even if the individual obtained the test without the involvement of a health care provider.
In addition to these coverage requirements, the CARES Act imposed pricing requirements for COVID-19 diagnostic testing. Specifically, if there was a negotiated rate between the plan and provider when the PHE was first announced in January 2020, that rate applies throughout the PHE. However, if the plan did not have a negotiated rate with the testing provider, then the plan must reimburse the “cash price” listed by the provider or negotiate a rate with the provider for less than the cash price. The “cash price” is the charge that applies to an individual who pays in cash (or cash equivalent) for a COVID-19 diagnostic test, and providers must publicize the cash price of testing on their website.
As noted elsewhere in the Managed Care Outlook, while these requirements greatly expanded access to COVID-19 diagnostic testing and related items and services, they were also ripe for abuse. But once the PHE ends, plans may limit coverage of COVID-19 testing to in-network providers, require a prescription or physician’s order for such testing, impose cost sharing for the test and associated visit if they are not deemed preventive services, and potentially even limit the number of covered tests, so long as the conduct is consistent with the member’s plan language – and the Affordable Care Act’s requirement to cover laboratory services as an essential health benefit where applicable. Moreover, at the conclusion of the PHE, there will be no requirement for plans to reimburse the cost of at-home tests.
Importantly, even after the PHE ends, plans are still required to cover COVID-19 vaccines and boosters without imposing cost sharing when provided by an in-network provider. And while the federal government has largely subsidized the cost of COVID-19 vaccines, tests and treatments, once the government’s supply is depleted, plans will be required to take on more of the cost.
The FFCRA and CARES Act and subsequent federal guidance vastly expanded telehealth services for Medicare recipients. Medicare beneficiaries were permitted to obtain a variety of different types of services, including audiology, speech pathology, mental and behavioral health care, and other services via telehealth. Moreover, the Centers for Medicare and Medicaid Services (CMS) expanded its list of approved locations for telehealth services, suspended its requirement that only “established” patients receive telehealth services, permitted reimbursement for physical health encounters conducted remotely, and waived requirements specifying the types of practitioners that could bill Medicare for telehealth services. Though not compelled to do so under the law, many commercial plans followed suit by expanding access to telehealth services for their members. For Medicaid, state programs largely dictated how and under what circumstances telehealth services would be covered.
For Medicare beneficiaries, access to mental and behavioral telehealth services will remain permanent, and Congress’s most recent spending legislation extended Medicare telehealth waivers through 2024. CMS is also encouraging states to permanently cover at least some telehealth services going forward. Plans should be prepared for how to approach such services, including who can provide and bill for telehealth and other remote services, once the PHE ends.