Vaccination coverage requirements for group health plans
Here's a brief overview of compliance obligations affecting group health plans’ coverage of COVID-19 preventive services.
With COVID-19 vaccination access ramping up across the United States, group health plan sponsors should carefully consider the new coverage requirements mandated for these vaccines. Specifically, Congress directs group health plans to cover COVID-19 vaccines under the familiar framework of the Affordable Care Act’s (ACA) preventive services rule. This article offers a brief overview of compliance obligations affecting group health plans’ coverage of COVID-19 preventive services (specifically the vaccine) as well as other important employer concerns.
COVID-19 vaccine coverage mandate
Today’s vaccine coverage rules harken back to the original twin Coronavirus relief measures enacted almost a year ago. When Congress enacted the Families First Coronavirus Response Act (FFCRA) and Coronavirus Aid, Relief and Economic Security Act (CARES), the media prominently highlighted the provision directing group health plans to cover COVID-19 testing at no cost to plan participants. Although drawing comparatively less attention at the time, legislators anticipated eventual vaccine availability and therefore included CARES Act language that now mandates COVID-19 vaccine(s) coverage without cost-sharing.
As referenced above, since ACA already mandates that group health plans (apart from validly grandfathered plans) provide certain preventive services without charge, adding new COVID-19 related care to the preventive-services list for “free coverage” conveniently secures the target COVID-19 enhancements. This means that federal law requires non-grandfathered group health plans to cover COVID-19 vaccines and other preventive services without cost-sharing.
In addition, Congress included special time frames for vaccination access. CARES directs that COVID-19 preventive services must be covered without cost-sharing beginning just 15 business days after a recommendation from Centers for Disease Control and Prevention (CDC)’s Advisory Committee on Immunization Practices (ACIP). HUB International is carefully monitoring CDC guidance to determine when plans must cover these items. In addition, vaccine-related recommendations are expected to evolve as new ones become available and as supplies improve. HUB will keep an eye on all these developments and share regular updates.
Paying for vaccinations
For now, the federal government is picking up the cost of the vaccine itself; however, vaccination providers will be able to charge an “administration fee” for giving the shot to someone. Regulations implementing vaccine access specify that the group health plan must cover the office visit fee associated with receiving the vaccine whenever the primary purpose of the visit is to get the vaccine. This means that anytime the provider codes an office visit to include services beyond the vaccine, the office visit will not be free.
Covering the vaccine
As referenced above, federal law mandates that health insurance carriers and non-grandfathered group health plans — whether insured or self-funded — must cover any qualifying coronavirus preventive service without cost-sharing. In addition, whether delivered “in-network” or “out-of-network” these vaccines must be available to participants absent cost-sharing.
As was the case with COVID testing, in-network providers must be paid the negotiated in-network rates. By contrast, a group health plan is only required to pay “out-of-network” providers a “reasonable” amount, as determined in comparison to prevailing market rates for such service. Importantly, this rule means that if the vaccine is administered by an out-of-network provider, that provider is not required to accept the plan’s paid amount as full satisfaction of the billed charges. Plan participants could therefore remain responsible for the balance of the bill (i.e., “balance billing”).
Plan documents
As plan sponsors did with the coverage mandate for COVID testing at the start of the pandemic, employers should verify that it is using a plan document that accurately communicates vaccination coverage availability. The good news is that as insurance carriers have generally prepared for the CARES vaccine mandate, many insured employers should find that certificates of coverage materials arriving for 2021 calendar year programs will already contain the required vaccine language.
Plans lacking the required language (especially self-funded programs) must be amended to include the coverage and that change must be communicated to participants. However, as this plan coverage change represents a benefit “enhancement,” ERISA disclosure rules give the plan sponsor 210 days following plan year-end to issue notification. Nonetheless, since employees will undoubtedly have questions about coverage, employers should consider proactively communicating that the plan will cover vaccination costs.
Although COVID-19 vaccines are likely still months away from becoming broadly available, plans should review their ability to provide coverage without cost-sharing now, particularly given the “15-day following CDC recommendation” timing directive.
Dennis Fiszer is chief compliance officer and senior vice president for Hub International. He provides compliance and consulting services regarding health plans and other employee benefits. His areas of expertise include all aspects of ACA, including employer reporting, hours tracking, transition relief, and plan valuations for affordability and minimum essential coverage analysis. His work also centers on ERISA, COBRA, FMLA, state and local leave laws, the Health Insurance Portability and Accountability Act of 1996 (HIPAA), wellness programs, employment and labor issues, cafeteria plans, and compliance with Internal Revenue Code requirements for favorable tax treatment of benefits.
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