Medicaid and At-Home COVID-19 Tests

As COVID cases have surged across the United States due to the new Omicron variant, the Biden Administration has stepped up efforts to expand testing capacity including by making at-home COVID tests more available.  Recent efforts include a new program that started January 18th to allow every household to order 4 free at-⁠home COVID-⁠19 tests from; increasing the number of COVID tests available to schools and community health centers; standing up new federal free-testing centers; and requiring private health insurers to cover the costs of at-home COVID tests.  While there has been a lot of attention paid to coverage and reimbursement requirements for at-home tests for people with private insurance, there seems to be confusion about how Medicaid enrollees can access at-home COVID tests.

What are the rules for Medicaid coverage of at-home tests?

Recent press releases and FAQs note that in accordance with the American Rescue Plan Act (ARPA), State Medicaid and Children’s Health Insurance Program (CHIP) programs are currently required to cover FDA-authorized at-home COVID-19 tests without cost-sharing. In August 2021, the Centers for Medicare and Medicaid Services (CMS) issued guidance about coverage and reimbursement of COVID-19 testing under the ARPA for Medicaid and CHIP.  The guidance says that “all types of FDA-authorized COVID-19 tests must be covered under CMS’s interpretation of the ARP COVID-19 testing coverage requirements, including, for example, “point of care” or “home” tests that have been provided to a Medicaid or CHIP beneficiary by a qualified Medicaid or CHIP provider of COVID-19 tests.”  It further indicates states have discretion to condition coverage of a home test on a prescription as part of their utilization management or apply medical necessity criteria. The guidance also says that “as states establish utilization management techniques, including possible prescription conditions, they are encouraged to do so in ways that do not establish arbitrary barriers to accessing COVID-19 testing coverage, but that do facilitate linking the reimbursement of a covered test to an eligible Medicaid or CHIP beneficiary.”

Given that Medicaid covers low-income individuals, Medicaid rules would allow individuals to access at-home COVID-19 tests without having to pay out of pocket and then seek reimbursement.  Under the new federal rules, private insurance must reimburse for up to 8 tests per member per month, however, in many cases this may require individuals paying out of pocket and then filing for reimbursement from insurance.  There is no mechanism in Medicaid to provide similar direct reimbursement to enrollees, so even if enrollees could afford to pay out of pocket, they could not recoup costs in the same way.

How are states implementing these rules?

As with most rules for Medicaid, states have some discretion and flexibility in how they provide coverage and reimbursement for at-home tests so there may be variation across states in how easily enrollees can access at home tests.  While state policy and bulletins are evolving, a number of states are using a standing order to allow Medicaid enrollees to obtain at-home tests from a retail pharmacy with no cost sharing.  For example:

  • A bulletin in North Carolina says that “effective Jan. 10, 2022, NC Medicaid-enrolled pharmacies may bill for FDA approved over-the-counter (OTC) COVID-19 tests dispensed for use by NC Medicaid beneficiaries in a home setting, with or without a prescription issued by a NC Medicaid-enrolled provider…NC Medicaid will cover one kit per claim per date of service, with a maximum of four test kits every 30 days.” The bulletin specifies which tests will be covered, how the pharmacy can claim Medicaid reimbursement and that there is no copayment.
  • A Massachusetts bulletin states that effective January 14, 2022, at-home antigen self-test kits are covered through the MassHealth pharmacy benefit without prior authorization with a limit of eight test kits per member per month (additional tests can be covered with prior authorization on a case-by-case basis). The Department of Public Health issued a statewide standing order that allows licensed pharmacists to dispense self-test kits to any individual, and to treat that standing order as a prescription for any such test kit. Accordingly, an individual prescription is not required for any such test kit. Additional guidance directs Medicaid Managed Care Organizations (MCOs) and the Program of All-inclusive Care for the Elderly (PACE) to provide coverage for at-home tests as well.
  • In December, Maine and Vermont also issued guidance that pharmacies may now bill for select at-home tests for Medicaid and specified that the a pharmacists can be the prescribing provider through the use of a standing order.

Under the rules, states can require a prescription for the at-home tests.  For example, New York issued guidance in December 2021 confirming Medicaid coverage of FDA-approved at-home tests ordered by a Medicaid-enrolled practitioner.  The bulletin requires a fiscal order (similar to a prescription) for each at-home test kit and limits coverage to one test kit per week.  The bulletin specifies that while the coverage policy applies to all types of plans, the COVID-19 testing billing and reimbursement may vary across MCOs.  It is not clear how many states are imposing prescriptions or other utilization management techniques.

What are key issues to watch for Medicaid enrollees?

As states continue to update and adopt policies about coverage for at-home tests, it will be important to provide outreach and education to facilitate access.  If enrollees are not aware of a policy that may enable them to access at-home tests from a pharmacy without cost-sharing, they may not seek out at-home tests at all due to the cost.  State Medicaid agencies, pharmacies, and managed care plans could help inform enrollees about coverage policies.

Variation in Medicaid policies about coverage and access to at-home tests will make national education efforts challenging.  It will be important to see how quickly and effectively new efforts to increase general supply of at-home tests work to address current shortages.  Many Medicaid enrollees work in jobs where they are at risk of contracting COVID-19 (such as health care, retail or food service) with top occupations among Medicaid workers include cashiers, drivers, janitors, and cooks.  Given these types of jobs, Medicaid enrollees may require even greater access to at-home testing to ensure they can follow isolation protocols if they test positive.

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