More than three years after the coronavirus shut down the world, the Biden administration announced in early 2023 the end of the U.S. National Emergency and the Public Health Emergency, two declarations that had mandated health insurance coverage of COVID-19 tests and vaccines, among other requirements. As these regulations are now rolled back, what does that mean for employer-sponsored health plans?

In this episode of Critical Point, Milliman health experts discuss the implications, from whether to continue paying for at-home COVID-19 tests and when to phase out standalone telehealth benefits, to how to communicate any changes with plan members at this significant moment in the pandemic.

Transcript

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Stephanie Peterson: Hello, and welcome to Critical Point, brought to you by Milliman. I’m Stephanie Peterson, a principal and consulting health actuary in Milliman’s Health and Group Benefits practice, and I’ll be your host today. In this episode of Critical Point, we’re going to be talking about the end of the COVID-19 public health emergency and what this means for health and welfare plan sponsors.

Given Milliman’s involvement in the health and welfare space and plan communications, we have a unique perspective on this topic. In fact, we just conducted one of our Pulse Surveys on benefit trends to see how plans are reacting to the end of the federal emergencies, and we have found some very interesting insights.

So to discuss the survey results, and the termination of the Public Health Emergency and National Emergency, I want to introduce three of my Milliman colleagues here with me today, Marcella Giorgou, Anna Morgan, and Amanda Burkhart.

Marcella is a principal and consulting actuary. She’ll provide her insight from a multiemployer plan sponsor perspective.

Marcella Giorgou: Hello.

Stephanie Peterson: Anna is a consulting actuary located in Atlanta, and she’ll be providing insight from the commercial plan perspective.

Anna Morgan: Welcome.

Stephanie Peterson: And finally, Amanda is a communications consultant based in the West, and she’ll address what plan sponsors may need to communicate with their members in light of these changes.

Amanda Burkhart: Hi, thanks for having me.

Stephanie Peterson: And I should say that this is an evolving topic. We are recording on April 5th of 2023, and we expect that more guidance and clarification will come out between today and May 11th, when the health emergencies are currently scheduled to end.¹

Continued health plan coverage of COVID-19 tests

So let’s begin with the issue of continuing coverage of COVID-19 testing. And Anna, I’m going to ask you first: From your perspective, are plan sponsors continuing to pay for testing coverage? And what are your clients doing, and what are you hearing?

Anna Morgan: Great, Stephanie. That’s a great question. I think we look at this in two different ways. One is what are plan sponsors going to do going forward with at-home COVID testing, and two, how are they going to cover the COVID testing in the doctor’s office?

So first, for the at-home COVID testing, this has been covered at 100%. The majority of clients are looking to go back to pre-COVID ways, basically saying that they’re not going to cover this going forward. The IRS is considering COVID tests as eligible expenses reimbursable under health savings accounts (HSAs) and flexible spending accounts (FSAs). So therefore, employers will not cover the COVID tests, and instead, the members would need to be notified that they can get reimbursed under their FSA or HSA. We do see that many pharmacy plans are recommending that this be discontinued coverage through the pharmacy for a number of reasons, particularly administration. However, we do see that the government is encouraging plan sponsors to continue to provide coverage for at-home COVID tests.

When we talk about the COVID testing in the doctor’s office, we do see that the majority of employers are going to revert back to pre-COVID ways, where basically this would be covered under a lab test. And it would be covered under in-network, and potentially out-of-network, depending on how the plan covers it today.

So again, this is just some viewpoints based on what we’re hearing from some of my clients. I’d like to turn it over to Marcella to see if she has anything additional from her clients.

Marcella Giorgou: So I can take it from the multiemployer plans perspective. I’ll start with over-the-counter testing. Similar to Anna, I think what we’re seeing here is a little bit of a mixed bag. So some clients have decided to stop covering over-the-counter tests once the public health emergency ends. Other clients have decided to still offer it. I think they’re balancing the financial impact to the fund of covering the tests. And the way they’re approaching it is they’re considering the costs of a member actually going to the doctor and having—needing a COVID test, right? So obviously the price of that is higher than if they just went and bought an over-the-counter test from the pharmacy and took that. So really, some plan sponsors are looking at it as more cost-effective to cover it over-the-counter. I think that decision really depends on the group, What industry your employees are working in, and then also just how much experience you’ve seen in terms of how much spend is on over-the-counter versus at the doctor’s office. I think we’re also seeing that pharmacy benefit managers (PBMs) are encouraging plans to just go back to not covering the over-the-counter test, although they’re allowing you to do something custom if you would prefer.

On the in-office testing, we are seeing more plans just revert back to covering in-office testing at the plan’s cost sharing. So whatever a lab would cost in the plan, the plan sponsor would revert back to that cost sharing for the member. And again, I think it’s weighing the financial impact of that against what your members need.

Surprisingly small spend on COVID-19 home tests

Anna Morgan: Marcella, I will add to that, I think it was a good point. We have been tracking, for many clients, the actual spend of these at-home COVID tests, and they have been much smaller than anticipated. Either members are just paying for it themselves and not getting reimbursed, or they’re having issues at the pharmacy, or they’ve basically gotten some of their at-home COVID tests through the government itself. So I wouldn’t anticipate a significant member disruption should you decide to end coverage of the at-home COVID tests.

Marcella Giorgou: Yeah. I would agree with that. We’re also not seeing that on the multiemployer side.

The Pulse Survey results show that around 50% of employers who responded to the survey have decided not to continue coverage for COVID tests at no cost sharing. Of that 50%, around 21% have decided to at least provide over-the-counter coverage. I think that’s consistent, Anna, right, with what we’re kind of seeing in terms of having a mix of decisions depending on where the plans are financially and what their employees or members need.

Anna Morgan: Right. Exactly.

Stephanie Peterson: This is great, team. I think what I hear is, then, that while there are a lot of employers and plan sponsors considering moving and keeping or terminating the COVID testing, that it’s really kind of a, like you were saying, Marcella, a mixed bag. Kind of a 50-50, if you decide you want to continue with the coverage. It doesn’t seem like the cost is all that impeding for many plan sponsors, but at the same time, if you decide you want to terminate the COVID testing going forward, that the disruption is at a minimum. But to your point, it’s very much an employer or a plan sponsor decision that needs to be made that takes into account their employee population and their needs.

How health plans may cover COVID-19 vaccines after the emergencies

Now I’m going to switch it up to Marcella to go first, and we’re going to go ahead and talk about the COVID vaccination requirement that did come along with the public health emergency, and we’re going to go ahead and understand, well, Marcella, how are your clients handling the requirement of continuing coverage of the COVID-19 vaccination? And what sorts of things should plan sponsors be considering?

Marcella Giorgou: Sure. I think here the requirement of continued coverage of COVID-19 vaccinations is required in-network, and plan sponsors have the decision on whether or not they want to provide the coverage out-of-network. What we’re seeing, again, here is a mixed bag, although I think most of my clients are leaning towards just providing the coverage in-network, consistent with the way that they cover other vaccinations. I think in terms of cost sharing, obviously because it’s a preventative service, all plans would need to cover it if you’re non-grandfathered at zero-dollar cost sharing.

What we saw in the Pulse Survey results is that’s consistent. About 40% of the employers who responded said they would not limit it to in-network, while 20% said they will. So again, a mixed bag. And I think here, again, you just have to think about the financials of the plan versus your member base. And for some industries, it might be more important, right, to make sure that members are getting their preventative vaccines and that they have access to it in-network and out-of-network, versus other industries.

Stephanie Peterson: Anna? Would you mind giving us a perspective from the commercial plan space?

Anna Morgan: Sure. I mean, we do envision that these COVID vaccines will be similar to how we look at the flu vaccines. So basically how your plan design covers it in-network versus out-of-network, it could be an idea to make sure those are mirrored. If you do decide to make a change and cover out-of-network, you may need to change your Summary Plan Description (SPD), make some additional revisions to your plan design, so please do make sure to keep that in mind.

The other thing about the vaccines is up to this point, plan administrators have been paying the administration fee of the vaccine and not the serum. So you’ve been paying about a $40 fee for the vaccine. Once the emergency ends, or actually once the vaccine coverage basically runs out, the employers will now have to pay the full cost. And so what we’re seeing as of today is that Moderna is estimating the vaccine to cost about $130, whereas Pfizer is estimating about $115 for an adult dose. That does decrease based on your age, linearly, based on your dosage information. So we would want to make sure that your financials do take that into account as well.

Stephanie Peterson: Very, very good point. I know that’ll be at top of mind for many employers as they’re projecting costs going forward this year and then also the upcoming plan years.

After the COVID-19 emergencies: Communicating changes to health plan members

So I’m going to switch it over, because another piece that’s almost as important as the actual cost and the regulations is also the communications side of things. And so Amanda, there’s a lot of changes coming up, and with all of these changes, how should plan sponsors think about communicating with their members?

Amanda Burkhart: Yeah, absolutely. You know, we hear kind of in the grapevine people saying things like, “Well, we’re going to stop covering tests over-the-counter and we don’t want to draw attention to that, so we’re not going to communicate.” Or, “We’re going to continue covering tests over-the-counter and we don’t really want to draw attention to that either, so we’re not going to communicate.” And really, the bottom line is, you may not want to draw attention to what you’re doing, but the end of this emergency is something that’s out there in the news. It’s something people are going to be hearing about, and people might have questions. They might be wondering, “Can I still get my eight over-the-counter tests?” Even though that was something we’ve seen wasn’t a highly used benefit in most places, they might be wondering what they can get and where they should get it. And for your plan, it might be less expensive for them to get those over-the-counter tests than go in to the doctor for it.

So at the very minimum, we really recommend that plans make sure they have at least an internal communication plan in place. Make sure the people who are going to be answering those questions and answering the phones know what the answer is. So your human resources (HR) folks, your benefit administrators, make sure if someone calls and says, “Hey, what’s covered?” they know what the changes are going to be or not.

And also, you might get the question of why. “Well, you’re not going to cover it anymore? Why not?” Make sure they’re armed with something to respond to that kind of a question. You don’t want to leave someone on the spot saying, “I don't know why we changed it.” Or, “We didn’t want to spend the money.” You want to make sure you have a planned message that’s going to be shared and be consistent across the board.

Opportunity to drive health plan member behavior

On the other side of the coin, if you really want to take advantage of this change as an opportunity to drive the kind of behaviors you want to see in your plan, this is a great chance to do that. We talked about the vaccines and how most plans want to see people get their preventive vaccines. That it prevents costs down the road and we want to see that happen. So this is a great chance to put out an email. Maybe if you have a newsletter, put it in there. Have it be something that gets talked about, to say, ”Preventive vaccines are important, get your flu shot, get your COVID vaccine.” And kind of drive people where you want to see them do that. So even if you're going to continue to cover it for out-of-network administration, we all know that usually the cheapest place to get it is the pharmacy, because they’re not necessarily charging that administration fee. So you can send out something that says, “Remember, here’s our in-network pharmacies where you can go get your preventive vaccines, including COVID, at no cost.” It’s a good chance to put out that kind of communication.

And then again, and I’ll probably say it over, but always remember, check with your legal folks. If you’re making any kind of substantial plan change, you need to make sure that you’re putting out the right kind of communications and making sure you’re meeting those legal expectations for what communications need to go out and when.

Stephanie Peterson: That’s great. Yeah. That’s always a good perspective. Employees aren’t necessarily—and participants—aren’t always in the weeds, like we are, in healthcare, so it’s ultimately up to us to help guide them in a way that makes the most sense. Right?

So team, this has been great. And we’ve highlighted a lot of the main components already. However, there are always things that we should be considering that maybe we haven’t mentioned already. So are there items that plan sponsors are not considering currently that maybe should be?

Mental health parity post-COVID-19

Marcella Giorgou: I think one of the things that came through on the Pulse Survey results is that some employers have not made a decision yet. I think it’s important to think through and take your time with making a decision around what you do at the end of the Public Health Emergency and the National Emergency, but it’s also important to make that decision in advance of it. And we got at it a little bit. Amanda talked through the communications and thinking through what you need to do there for your employees and members, both legally and just in terms of communicating the right message. But also, it’s important in terms of making sure that you’re meeting other rules and regulations that impact this. And that includes mental health parity.

During the Public Health Emergency, the rules around mental health parity and covering COVID-19 tests were waived, but now that the Public Health Emergency is ending, plans will need to make sure that they are providing medical benefits consistent with their mental health benefits, even with regards to COVID-19 tests. So if you decide to do something different in the plan for covering COVID-19 tests that looks different from what you would, for example, do to cover a lab test, you need to take that into account in making sure that you meet mental health parity requirements. So it’s definitely important that you think through your decisions now, in advance of the end of the Public Health Emergency.

The other thing I just wanted to bring up is that we talked a lot about the Public Health Emergency, but the National Emergency is also ending, and this impacts some of the deadline extensions that were implemented during the national emergencies around things like COBRA deadlines, for example. Anna, did you want to take that a little bit?

COBRA, consistency, and other plan considerations as the COVID-19 emergencies end

Anna Morgan: Sure. Actually, there was an FAQ that was sent out on March 29th, which was very valuable, that basically provided a lot of examples as to changes to deadlines and COBRA notices, HIPAA notices. We strongly recommend that you do review those, but also talk with your COBRA administrator to make sure that they’re on board with the changes that will be taking place, because there will be deadline changes. And so we just want to make sure that you’re up-to-date with all of those.

Stephanie Peterson: That’s a great point. Amanda, would you like to comment? Anything on the communication side?

Amanda Burkhart: Yeah. You know, one other thing that kind of came to mind when Marcella was talking was consistency. And that’s really important for people to understand their plan. So if you’re not making a change and COVID vaccine administration is going to be covered out-of-network, but flu vaccine administration is not? That’s something people need to know about. When things are different, you don’t want someone going out-of-network and getting this big, unexpected charge for their flu vaccine when they got their COVID and flu at the same place.

If you’re making a change that might be seen as a reduction, like you’re no longer covering over-the-counter tests for COVID, an easy message or an appropriate message for that can be, “We’re making it consistent with other coverages in our plan. We don’t want it to be confusing. We want it to be easy for you to understand, so we’re just kind of going with what’s consistent.” So that’s an important thing when you’re messaging for your plan members.

Stephanie Peterson: That’s great. And anything else, team, that you can think of?

Post-COVID-19 implications for telehealth benefits

Anna Morgan: Yeah, so just a few additional items. One question that we asked in the Pulse Survey was regarding standalone telehealth benefits. Less than 30% of the responders actually said that they do offer this. But we do know the guidance says that this will basically cease at the end of 12/31/23, so if you do have a standalone telehealth benefit, that will need to basically be terminated, and you will need to provide 60-day notice to any employees that have a reduction of material benefits, basically.

Also, regarding telehealth, there has been some statutory relief regarding the Alliance of Community Health Plans (ACHP) with telehealth. So there’s no changes that need to be made there until, I believe, the end of 12/31/24.

Stephanie Peterson: Great. Well, this has been very enlightening, and I thank you, all three of you, Anna, Marcella, and Amanda for joining us today. You can see more of Milliman’s analysis of the COVID-19 health emergency on our website at Milliman.com, and you can see the full results of our Pulse Survey at Milliman.com/pulse-survey.

You’ve been listening to Critical Point, presented by Milliman. If you’ve enjoyed this episode, rate us five stars on Apple Podcasts and share this episode with your colleagues. We’ll see you next time.

¹ President Biden terminated the national emergency on April 10, 2023. See https://www.whitehouse.gov/briefing-room/legislation/2023/04/10/bill-signed-h-j-res-7/.