What Are Healthcare Payers’ Coverage Obligations for COVID-19 Antibody Testing?

COVID-19 Update

With the rise of COVID-19 cases in many of the country’s most populous states, coupled with the looming second wave of state shutdowns, the scope of healthcare payers’ COVID-19 coverage obligations is again under the microscope. As infection rates rise, so does the desire for many Americans to get tested for COVID-19 antibodies. But will payers be obligated to pay for antibody testing?

The COVID-19 Antibody Test

COVID-19 antibody testing, also known as serology testing, is a blood test done to determine whether an individual had a past infection with the COVID-19 virus.1 The antibody test does not determine whether an individual is currently infected with the COVID-19 virus.2 The accuracy of these serology tests has been questioned, as has the impact of positive antibody tests on future immunity. In light of the questionable accuracy and utility of antibody tests, to what extent should payers be responsible for covering them?

Financial Impacts of COVID-19 on Healthcare Payers

Payers are staring at a substantial financial cost for covering COVID-19 antibody testing.

These payers are already facing significant unforeseen costs relating to this global health crisis. Payers are likely to be responsible for much of the cost associated with testing for and treating the COVID-19 virus—a cost that is nearly impossible to predict. On top of that, payers are facing threats of litigation, including potential liability from the wave of new laws, regulations, orders and guidance issued by local, state and national governments.3

Adding the costs of covering antibody testing would undoubtedly be a financial strain on payers, even with government aid. Wall Street firm Jefferies & Co. estimates the demand for hundreds of millions of antibody tests in the next 18 months, which could account for one-quarter of an anticipated $15 billion in U.S. COVID-19 test spending through the end of 2021.4 Within the industry, a spokeswoman for America’s Health Insurance Plans has estimated that U.S. antibody testing alone will cost the United States $19 billion a year.5

Although the estimates vary, there seems to be a consensus that antibody testing will generate a significant bill that payers may be expected to foot.

With these cost implications in mind, healthcare payers are asking government entities and agencies for clarity concerning their current antibody testing coverage obligations and what to expect as the nation continues to fight the virus into 2021.

A related question is whether an antibody test is a “medically necessary” service for which the insured is entitled to coverage. This is far from settled, especially given the U.S. Centers for Disease Control and Prevention’s (CDC) recent cautions concerning whether a positive antibody test even means future immunity to the virus.6

Antibody Testing Coverage and Limits

The U.S. government has funded various programs to ensure the country’s health providers and payers can continue to fight the COVID-19 virus.

On June 23, 2020, the Department of Labor, Department of Health and Human Services, and the Department of the Treasury issued new frequently asked questions (FAQ) regarding coverage for testing under the Families First Coronavirus Response Act and the Coronavirus Aid, Relief, and Economic Security (CARES Act.

Like the previous guidelines, the recent guidelines explain that health plans and health insurance issuers are required to provide coverage for virus-related medical costs, including antibody testing.7 Yet these guidelines also reiterate that these coverage obligations apply only to medically necessary care. Importantly, this excludes precautionary antibody testing for employees returning to work and not showing symptoms, as payers are not required to cover antibody testing for exclusively employer- or surveillance-related purposes.8 Under this recent guidance, a plan may refuse to cover antibody testing conducted exclusively for public health surveillance or any reasons not primarily concerned with the diagnosis or treatment of the actual virus.9

While these guidelines ease some concerns for payers, many questions remain unanswered, increasing the likelihood of litigation stemming from coverage denials or partial payment determinations that may violate the shifting laws and regulations.

Disputes Over Antibody Tests

A number of the largest payers have publicly stated that they will not cover all of their members’ antibody testing. The list of these payers is fluid, changing by the week. But as an example, Oscar recently informed its members that it will be covering antibody tests only when the tests are medically necessary, including when used to diagnose COVID-19 or to determine a treatment plan, or if the antibody test is provided in line with CDC recommendations.10

In California, recent data suggest that antibody reimbursement continues to be a hot issue among members, their plans and their providers. XIFIN, a health information technology company, has claimed that payers were improperly denying or underpaying up to 43% of antibody testing claims; more recently, this percentage has decreased to approximately 25%.11 These payment disputes may lead to future litigation between members, payers and providers.

Similarly, without clear guidance concerning the actual costs (or reimbursement expectations) of antibody testing, payers and providers may need to litigate payment obligations for administering the antibody tests. For example, charges for the antibody tests by some of the nation’s largest hospitals range anywhere from $36 to $300.12 And there are still few data on what healthcare payers are actually reimbursing providers, as the data allow only a guesstimate of possible payments for antibody testing charges.13 Payers will continue to struggle with determining reimbursement obligations for antibody testing without further guidance from government agencies and entities.

Future Relief Bill(s)

As U.S. lawmakers are starting negotiations this week on a potential next round of COVID-19 relief, the need for additional funds designated for testing—including antibody testing—will surely be debated. To date, the country has run more than 47 million tests (diagnostic and antibody); yet the Rockefeller Institute recommends the country should be running up to 30 million tests weekly by October, and the White House aims to conduct 50 million tests per month by the fall.14 With these estimated totals in mind, if government guidance is not provided as to antibody testing coverage obligations, the threat of litigation to the nation’s healthcare payers will continue to grow.

Key Takeaways

As the demand for antibody testing grows, and as more employers implement large-scale return-to-work plans, payers should continue to monitor and advocate for government guidance on antibody coverage obligations. Without those clarifications, the risk of litigation looms in the background.

1 Mayo Clinic, COVID-19 antibody testing (issued July 11, 2020), available at https://www.mayoclinic.org/tests-procedures/covid-19-antibody-testing/about/pac-20489696.

2 Id.

3 Manatt attorneys recently covered these issues, as well as others, in a Law360 article that can be found here.

4 Reuters, U.S. health insurers may balk at paying for coronavirus antibody testing (published June 16, 2020), available at https://www.reuters.com/article/us-health-coronavirus-usa-testing-focus/u-s-health-insurers-may-balk-at-paying-for-coronavirus-antibody-testing-idUSKBN23N1PD.

5 Id.

6 CDC, Test for Past Infection (Antibody Test) (updated June 30, 2020), available at https://www.cdc.gov/coronavirus/2019-ncov/testing/serology-overview.html.

7 The National Law Review, “New Guidance on Health Coverage Issues Relating to COVID-19” (published July 8, 2020), available at https://www.natlawreview.com/article/new-guidance-health-coverage-issues-relating-to-covid-19.

8 MedTech Dive, “Payer coverage of employer, surveillance COVID-19 tests not required, feds say” (published on June 25, 2020), available at https://www.medtechdive.com/news/payer-coverage-of-employer-surveillance-covid-19-tests-not-required-feds/580451/.

9 JD Supra, Group Health Plans Must Cover Some – Not All – COVID-19 Testing (published July 14, 2020), available at https://www.jdsupra.com/legalnews/group-health-plans-must-cover-some-not-27492/.

10 Crain’s New York Business, “Oscar tells members it won’t cover most antibody tests” (published July 8, 2020), available at https://www.crainsnewyork.com/health-care/oscar-tells-members-it-wont-cover-most-antibody-tests.

11 Business Wire, “XIFIN Data Reveals COVID-19 Antibody Testing Volumes Surprisingly Low; Better Payor Coverage Needed to Support Testing Increase” (published June 29, 2020), available at https://www.businesswire.com/news/home/20200629005137/en/XIFIN-Data-Reveals-COVID-19-Antibody-Testing-Volumes.

12 Peterson-KFF Health System Tracker, COVID-19 Test Prices and Payment Policy (posted July 15, 2020), available at https://www.healthsystemtracker.org/brief/covid-19-test-prices-and-payment-policy/.

13 Id.

14 Healthcare Dive, “As Congress weighs next COVID-19 relief bill, 4 healthcare sticking points” (published July 20, 2020), available at https://www.healthcaredive.com/news/as-congress-weighs-next-covid-19-relief-bill-4-healthcare-sticking-points/581923/.



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