Helping Your Older Workers Transition to Medicare

November 5, 2020

As health insurance costs rise and our workforce ages, fewer employers are providing retiree health insurance benefits to their older workers, and are instead asking them to sign up for Medicare.

It’s a delicate situation as some older workers may resent being pushed to Medicare, especially if they’ve worked for their employer a long time. But employers obviously want to keep their staff happy and not risk losing them just because they are asking them to move to Medicare.

The share of people aged 65 to 74 in the workforce has been steadily rising for years. It’s projected to reach 30% in 2026, up from 27% in 2016 and 17% in 1996, according to the Bureau of Labor Statistics. And among those 75 and older, the share projected to be working in 2026 is 10.8%, up from 8.4% in 2016 and 4.6% in 1996.

While some employers opt to keep their Medicare-eligible workers on their group health plans, the majority do not. With the Kaiser Family Foundation estimating that only 29% of employers are keeping their Medicare-eligible employees on their company health plans, how can they support transitioning from their employer health plans to Medicare plus supplemental coverage?

If you have employees who will soon be eligible for Medicare and you want to transition them, you can help them and be there for them as a trusted source of information. Here’s what you can do to help workers who are nearing retirement to enroll:

Consider group Medicare Advantage coverage – There are a number of Medicare Advantage insurers that offer group Medicare coverage, which will help provide a transition from regular group health insurance. The nice thing about Medicare Advantage group health coverage is that often the premiums are quite low compared to regular health plans.

We can help you get set up with a Medicare Advantage group carrier that can take the administrative burden off you. We can send plan materials and other resources directly to your Medicare group members.

You can also choose to have Medicare group members billed directly for their premiums, or you as their employer can be billed.

Some carriers will let you customize your group Medicare Advantage plan with different deductibles, coinsurance and copayment amounts.

Help with the ‘donut hole’ – All Medicare plans have a coverage gap (known as the “donut hole”) for medicines. The coverage gap begins after an enrollee and their drug plan (or Medicare Advantage plan) have spent a certain amount for covered drugs. While they are in the coverage gap, which starts after they and their plan have spent $4,130 on pharmaceuticals in a given year, they will pay 25% of the cost of most drugs.

Seniors can’t get a plan on their own that offers help through the coverage gap. Retirees can only skip the coverage gap through an employer-sponsored plan. That’s where you come in.

By offering your retirees a prescription drug plan with coverage through the gap, you’ll help ease the financial burden that the coverage gap can present.

Make it user-friendly -For years your employees have been used to the top-shelf open enrollment system you have had in place for your workforce, with support like a hotline and access to plan information, such as lists of provider networks and formularies, as well as many different mediums for accessing enrollment information (like e-mail and mobile phone apps).

A recent study found that nearly 70% of workers who are 60 years or older find plan comparison tools and plan guidance tools valuable as they make health care decisions. Since this is what they are used to, you can provide the integrated, consumer-oriented experiences to help facilitate their enrollment in a Medicare Advantage plan.

Educate them about supplemental coverage – Medicare enrollees have access to an average of 28 Medicare Advantage plans, which means they will have a wider array of plans to choose from than they may be used to under their employer’s group plan.

They will also likely be bombarded with offers from various plans by mail and e-mail. It’s often confusing for many people to sift through the plans and find the one that’s best for their life and health circumstances. Many Medicare beneficiaries will seek out an advisor to help them choose the right plan.

In this case, a thoughtful employer would contract with an advisor to help their senior employees choose the best plan for them.

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Final Rule Paves Way for Drug Imports to Reduce Patient Costs

by Inoventive Solutions

October 27, 2020

The Department of Health and Human Services and the Food and Drug Administration have issued a final rule and guidance that paves the way for states to allow pharmacists and wholesalers to import prescription drugs in order to reduce costs for patients.

The final rule implements a provision of federal law that allows FDA-authorized programs to import prescription drugs from Canada under specific conditions, according to a report by Kaiser Health News. Prices are cheaper in Canada because the government there caps how much drug makers can charge for medicines, while the free market reigns supreme in the United States.

Even though insulin is not included among the drugs covered by the rule, the Trump administration also issued a request for proposals seeking plans from private companies on how insulin could be safely brought in from other countries and made available to consumers at a lower cost than products sold in the U.S.

Why now?

Congress has allowed drug importation since 2003, but only if the secretary of the Department of Health and Human Services certified it is safe. That had never happened until this year, when Secretary Alex Azar approved an application by Florida, according to a letter he wrote to congressional leaders.

For decades, Americans have been buying drugs from Canada for personal use – either by driving over the border, ordering medication online or using storefronts that connect them to foreign pharmacies, according to Kaiser Health News. Though the practice is illegal, the FDA has generally permitted purchases for individual use.

About 4 million Americans import medicines for personal use each year, and about 20 million say they or someone in their household has done so because prices are much lower in other countries, according to surveys.

How it would work

The administration envisions a system in which a Canadian-licensed wholesaler buys from a manufacturer of drugs approved for sale in Canada and exports them to a U.S. pharmacy, wholesaler or importer that has contracted with the state in which they operate.

To be eligible for importation, a drug would need to be approved by Canada’s Health Canada’s Health Products and Food Branch and needs to meet the conditions in an FDA-approved new drug application.

Essentially, eligible prescription drugs are those that could be sold legally on either the Canadian market or the American market with appropriate labeling.

Under the final HHS and FDA rule, state importation programs will have the flexibility to decide which drugs to import and in what quantities.

The rule also requires drug manufacturers to provide importers with documentation guaranteeing the medications are the same drugs as those already sold in the U.S.

Parts of this report were reprinted from Kaiser Health News.

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Getting a Head Start on Open Enrollment

by Inoventive Solutions

October 13, 2020

With open enrollment right around the corner, it’s time to review the health plan options available to you for the next year and prepare your workplace for signing up for the 2021 policy year.

The big decision for employers is finding a plan that fits not only their budget but also the budgets of their employees. And this is particularly important for “applicable large employers” under the Affordable Care Act, who must also ensure that the least expensive of their plans must not cost more than 9.83% of any of their health-plan-eligible employees’ household incomes.

This year, due to the COVID-19 pandemic, benefits advisors recommend that employers get an earlier than usual start on preparing for their upcoming open enrollments. The following are just a few issues you need to consider for this year’s open enrollment:

Determine how many employees will receive coverage – It’s to your advantage to try to get as many of your employees to enroll in your health plan as possible, particularly if you are a small employer. The more lives in your plan, the more the risk is spread for the insurer, which can translate into lower policy premiums for all of your workers.

Keep things simple – Try not to make open enrollment complicated. Your employees have enough on their minds during the pandemic. Your literature and meetings should provide easy-to-follow instructions that tell your workers:

What they need to do to enroll or re-enroll.
How they can choose the right health plan for themselves and their family, and
When the deadline is.

Get an early start and provide employees with health plan information prior to open enrollment, so as to give them enough time to review and compare their insurance options.

Informing your employees – If you are planning to meet with your staff in person, you’ll need to plan for social distancing as well as offering employees that cannot or do not feel safe the option to join the meeting via video conferencing.

If you plan to have your staff enroll and choose plans electronically, you need to make provisions for the ones who may not have access to a good internet connection or the technology to do so.

Periodically remind your employees to submit their applications or make changes before the end of the open enrollment period. Have a mechanism in place for identifying and approaching laggards as the deadline approaches.

The COVID factor – Your employees will want to know if testing and treatment of COVID-19 will be covered, as well as any vaccine that may eventually become available. Federal legislation enacted in March required all private insurance plans to cover costs associated with COVID-19 tests. A number of insurers announced that they would also waive all cost-sharing for in-network medical visits related to COVID-19, as well as for telehealth visits.

Since there are no laws that require private insurance plans to waive cost-sharing for COVID-19 treatment, you will have to explore your plan options to see which ones may offer treatment without cost-sharing. Also check to see if the plans you have access to will waive out-of-pocket fees for a coronavirus vaccine should one become available.

Coverage questions for your employees – Encourage your employees to ask questions during your meetings, and ask them to consider re-evaluating their coverage in light of:

Change in dependents – Will employees be adding or removing any dependents, such as children or a spouse, from their health plans? Will you the employer contribute to qualified dependent coverage and if so, how much?
Health issues – Does any employee have evolving health issues that will require more medical services than they have used in the past. They should also check to make sure their plan network includes their personal physician, as well as covering the medicines they may be taking regularly.
Affordability – How much are they willing to pay for coverage and what kind of deducible would be in their price range? What is the premium cost-sharing (how much the employee pays for their share of the premium)?

The takeaway

During the pandemic, you’ll need to get a head start on open enrollment by getting information on your offerings to your staff as early as possible. Be prepared to answer questions about coverage, particularly as it pertains to COVID-19.

You can work with us to make sure you have everything in place for a successful open enrollment.

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How to Distribute Group Health Plan Rebates to your Staff

by Inoventive Solutions

October 7, 2020

Group health plan insurers are paying out $689 million in rebates to plan sponsors this year, as required by the Affordable Care Act’s “medical loss ratio” provision.

The provision requires insurance companies that cover individuals and small businesses to spend at least 80% of their premium income on health care claims and quality improvement, leaving the remaining 20% for administration, marketing and profit.

The MLR threshold is higher for large group insured plans, which must spend at least 85% of premium dollars on health care and quality improvement.

Employers who sponsor health small and large group health plans around the country in the last few months have received notices of rebates from their insurers. For those who have received one for the first time, there’s always a question of what they should do with the surprise funds.

MLR rebates are based on a three-year average, meaning that 2020 rebates are calculated using insurers’ financial data in 2017, 2018 and 2019.

You received a rebate…now what?

Health insurers may pay MLR rebates either in the form of a premium credit (for employers that are still using the insurer) or as a lump-sum payment. More than 90% of group plan rebates come as a lump-sum payment.

Once an employer receives this money, it is their responsibility to distribute the rebate to plan beneficiaries appropriately within 90 days, or risk triggering ERISA trust issues.

How the employer distributes the check will depend on how much their employees contribute to the plan, if at all. Here are the basic rules for employers handling their MLR rebate checks:

If you paid 100% of the premiums, the rebate is not a plan asset and you can retain the entire rebate amount and use it as you wish.
If the premiums were paid partly by you and partly by the participants, the percentage of the rebate equal to the percentage of the cost paid by participants must be distributed to the employees.

If you have to distribute funds to the plan participants, the Department of Labor provides a few options (if the plan document or policy does not already prescribe how they should be distributed):

The funds can be used to reduce your portion of the annual premium for the subsequent policy year for all staff who were covered by all of your group health plans.
The funds can be used to reduce your portion of the annual premium for the subsequent policy year for only those workers covered by the group health policy on which the rebate was based.
You can provide a cash refund to subscribers who were covered by the group health policy on which the rebate is based.

How it works (example)

Total premiums paid to an insurance company for a plan with 100 covered employees during 2019 = $2,000,000.
Total participant contributions during 2019 = $500,000 (25% of total plan premiums for the year).
The employer receives a $30,000 rebate from the carrier in 2020.
A total of $7,500 is considered plan assets and must be distributed to the employees (25% of the $30,000).

Tax treatment of cash refunds

If your employees paid for their share of the health premium with pre-tax earnings, the refund would also have to be taxed. But if they paid for their premiums post-tax, they would not be required to pay taxes on the refund (unless they deducted the premiums on their income tax returns).

You must distribute rebates to your staff within 90 days of receiving them.

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Employees Pick Perks and Benefits Over Pay Raises

by Inoventive Solutions

September 30, 2020

Great perks and incentives packages can help attract top-notch talent, maintain employee morale and improve overall engagement and satisfaction with a company.

The coronavirus pandemic has made perks and benefits even more important, particularly in light of so many workers feeling burned out, stressed from working at home or feeling isolated due to closures and shelter-at-home orders.

Recently, retailer Staples surveyed 1,549 employees across the U.S. about their preferences for work perks, asking them to rate how various benefits affected their motivation and if they preferred perks over higher salaries ―and which benefits were most important to them when looking for work.

One of the major perks that employees have coveted in past surveys is the ability to work from home. Well, the coronavirus pandemic has suddenly thrust many workers into that position. But what other benefits and perks do workers look for in an employer?

Perks defined

Employee benefits and perks are a non-wage supplement to salaries and include, among other things:

Lifestyle/entertainment perks, such as Netflix/Spotify subscriptions, free coffee and snacks at work, or employee discounts.
Continuing education perks, such as tuition reimbursement, student loan repayment, or financial support for receiving professional certifications.
Health and fitness benefits, such as gym membership reimbursements, on-site fitness facilities or nutrition classes.
Workplace flexibility perks, such as flexible hours, commuter benefits or the ability to work remotely on a regular basis.
Family-focused/childcare perks, such as daycare reimbursement or paid family leave.

What is the overall best way to improve employee morale?

Higher base salary (37% of respondents)
More workplace perks (22%)
Performance-based raises (21%)
Recognition from supervisors (9%)
Team-building initiatives (4%)
Requesting employee feedback (4%)
Spontaneous holidays (2%)

Must-have perks and benefits:

Flexible hours (40% of respondents)
Paid health insurance premiums (34%)
Paid family leave (29%)
Regular remote work (26%)
Financial assistance with professional certifications (26%)

Perks and benefits employees deem nice to have, but not essential:

Employee discounts (43% of respondents)
Free coffee and snacks (42%)
Streaming-TV subscriptions (42%)
Gym membership reimbursement (35%)
Onsite fitness classes (30%)
Company car, laptop or phone (30%)

The takeaway

If you are considering expanding your perks and benefits, to attract or retain staff or motivate workers, don’t forget the following before deciding:

Four out of five employees feel that workplace flexibility options are the most important employee perk category.
Perks that employees say are “must have” include flexible hours, paid insurance premiums, and paid family leave.

Because the Staples survey found that half of employees prefer higher salaries while the other half wants more perks, consider polling your workers before making a change.
62% of employees would accept a lower salary in exchange for better workplace perks.

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Group Plan Affordability Levels Set for 2021

by Inoventive Solutions

September 23, 2020

The IRS has announced the new affordability requirement test percentage that group health plans must comply with to conform to the Affordable Care Act.

Starting in 2021, the cost of self-only group plans offered to workers by employers that are required to comply with the ACA, must not exceed 9.83% of each employee’s household income.

Under the ACA, “applicable large employers (ALEs)” — that is, those with 50 or more full-time workers — are required to provide health insurance that covers 10 essential benefits and that must be considered “affordable,” meaning that the employee’s share of premiums may not exceed a certain level (currently set at 9.78%). The affordability threshold must apply to the least expensive plan that an employer offers its workers.

The threshold was increased because premiums for health coverage increased at a greater rate than national income growth during 2020.

With this in mind, if you are an ALE you should consult with us to ensure that you offer at least one plan with premium contribution levels that will satisfy the new threshold.

Failing to offer a plan that meets the affordability requirement to 95% of your full-time employees can trigger penalties of $4,060 (for 2021) per full-time employee, minus the first 30. The penalty is triggered for each employee that declines non-compliant coverage and receives subsidized coverage on a public health insurance exchange.

Since most employers don’t know their employees’ household incomes, they can use three ways to satisfy the requirement by ensuring that the premium outlay for the cheapest plan won’t exceed 9.83% of:

The employee’s W-2 wages, as reported in Box 1 (at the start of 2021).
The employee’s rate of pay, which is the hourly wage rate multiplied by 130 hours per month (at the start of 2021).
The individual federal poverty level, which is published by the Department of Health and Human Services in January of every year. If using this method, an employee’s premium contribution cannot be more than $104.52 per month.

Out-of-pocket maximums

The IRS also sets out-of-pocket maximum cost-sharing levels for every year. This limit covers plan deductibles, copayments and percentage-of-cost co-sharing payments. It does not cover premiums.

The new out-of-pocket limits for 2021 are as follows:

Self-only plans — $8,550, up from $8,150 in 2020.
Family plans — $17,100, up from $16,300 in 2020.
Health savings account-qualified self-only plans — $7,000, up from $6,900 in 2020.
HSA-qualified family plans — $14,000, up from $13,800 in 2020.

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More Employers Ask Workers to Sign COVID-19 Waivers, But They May Not Be Legal

by Inoventive Solutions

September 15, 2020

As lawsuits against employers continue rising amid the coronavirus pandemic, some businesses are requiring workers to sign waivers absolving them of liability and responsibility should they contract the virus.

Eight percent of executives surveyed by law firm Blank Rome said they would require that their workers sign waivers of liability before returning to the workplace.

While employers are trying to protect themselves from a liability that didn’t even exist a year ago, some human resources legal experts have expressed concerns that they may not be necessary ― and may be unenforceable.

The moves come as employers are wrestling with numerous risks that the pandemic has wrought, and with the U.S. Senate having proposed legislation that would limit the liability of employers for workers who become sick during the pandemic. A number of states have also enacted laws or emergency regulations that make it harder for employees to sue employers for negligence over COVID-19.

COVID-19-spurred employee lawsuits have mostly centered on employers not providing the proper protections for workers, discrimination or for being laid off for refusing to come to work.

Legal experts caution that employers cannot require workers to waive rights they may have, such as access to workers’ compensation benefits or the right to file a complaint with OSHA.

They also say that some employers may consider waivers as a green light to not take precautions against COVID-19, but in such cases the waivers would likely not be legal.

If a worker claims they caught COVID-19 at work and the facts back that up, they would likely have access to workers’ compensation benefits (some states even require it). But if the employer was negligent, the employee could have further legal avenues to pursue besides workers’ compensation, rights that cannot legally be waived, lawyers say.

So even if an employee were to sign a document waiving their right to file a complaint if they feel their employer is being negligent, they may still have recourse.

Requiring workers to sign waivers could present a number of legal issues, according to the law website nolo.com, including:

Courts in some states are reluctant to enforce liability waivers in the workplace because of the superior bargaining power of employers over their staff.
Workplace morale could suffer if your employees think you are placing your own economic interests above workplace safety.
Any waiver employees sign would not protect your firm from lawsuits filed by their families should they contract COVID-19 if staff are infected at work.
A waiver might be unnecessary in states that have passed laws granting immunity to employers for claims made by workers infected with the virus.

Another option

While employees who refuse to sign a waiver of their company’s liability may have grounds to challenge their employer, some liability lawyers say that employers instead of a waiver can ask their staff to sign a social contract that requires:

The employer to follow Centers for Disease Control and Prevention guidelines and take all necessary precautions to prevent the spread of COVID-19 at work, and
The workers to comply with their employer’s requirements on mandates on wearing masks, social distancing and not coming to work if they have symptoms or of they think they have been exposed to someone with COVID-19.

This type of agreement won’t protect an employer from a lawsuit, but it does spell out that they are following authorities’ recommendation for protecting employees.

While employees who refuse to sign a waiver of their company’s liability could have grounds to sue, those who sign this type of acknowledgement of new workplace rules and government guidance are less likely to be successful if they are fired for not signing. This is because the acknowledgement is not forcing them to give up any of their rights and is rather for their and their co-workers’ protection.

These social contracts also would provide workers with a list of their responsibilities when working during the COVID-19 pandemic, and outline what their employer is doing to protect them.

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Preparing for Open Enrollment During the Pandemic

by Inoventive Solutions

August 26, 2020

With the coronavirus showing no signs of slowing, health insurance is likely top of mind for your employees. Many of them will be anxious and it’s likely that they will be more engaged and interested in understanding whether their current coverage is sufficient should they be stricken by the virus.

Not only that, but due to social distancing and with many employees working remotely, employers will need to adjust their open enrollment procedures to make sure they are safe, efficient and a success for both them and their employees.

This year in particular, it’s important that you use a multi-pronged approach that keeps everyone informed and safe.

Comprehensive and simple communications

When you are informing your staff about their benefits and open enrollment procedures, make sure you keep things simple. Don’t delve into too many details that are likely to confuse them, but explain the bigger picture and direct them to other documents and information for the detail.

When explaining the benefits and procedures, don’t get bogged down in insurance jargon. Use everyday language, charts, graphs or infographics, checklists and other tools that make absorbing the information easier.

Use many communication media

Many workplaces are multi-generational and different generations prefer different modes of communication, particularly if you have employees who are working remotely due to the pandemic

To make sure you can reach all of your workforce, blast them information using a number of media. And follow up with phone calls to remote staff that don’t respond.

E-mails and e-mail newsletters

E-mails are an excellent way to communicate important information to employees, and to gather information on what they are opening, reading and forwarding.

You can inform them about open enrollment, provide them documentation on the plan offerings and inform them of upcoming web meetings and other important enrollment information.

Web meetings

Hold webinar meetings with videoconferencing to inform your staff about their benefit choices and what, if any, changes are being made to plans going into the new year.

You should focus on the main topics:

Any increases in health plan premiums,
Plan changes like deductibles, out-of-pocket maximums, copays, and more,
Network changes,
New offerings, and
Resources to help your workers choose the right plan.

There will likely be many queries about COVID-19 coverage, so be prepared to answer related questions.

During these web meetings, encourage your staff to ask questions and get answers. Record the meeting for employees that are unable to make it, so they can view it on their own time.

You should require all of your staff to either participate in the actual meeting or view the meeting. Set up a virtual sign-up for them to confirm they attended and received all the information.

Offer benefit support

Not everyone is going to be able to wrap their noodle around everything you went over during the web meeting. And plan documents can sometimes be daunting and confusing to someone who is not experienced in your system or is new to the workforce.

Additionally, some of your staff may have questions they are not comfortable asking during a group meeting and that would be more appropriately directed at a benefit counselor. This way, they can talk to someone who can guide them in choosing the right plan for them.

Don’t forget text messaging

Since most everyone has a smartphone on their person or nearby at all times these days, sending them text messages is a sure-fire way to get in front of them.

Use texting to notify staff about open enrollment dates, resources about their benefits, upcoming benefit meetings, contact resources, how to access the enrollment and benefit portal, and who to call for assistance.

Company intranet, enrollment portal

Post all of your open enrollment information on your company intranet if you have one, including links to the open enrollment portal. Every time you communicate with your staff, include the link to the open enrollment information.

This page should have all of your enrollment information, including start and end dates, links or pdfs of all plan benefit guides and plan summaries, contact information of key personal and benefit counselors, as well as all other resources they will need to choose their health plan.

The takeaway

By employing a mixture of all of the above strategies, you can conduct a safe and informative open enrollment that can help your staff choose their plan wisely and also feel comfortable about not catching COVID-19 during the process.

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A Primer on Changes to 2021 Group Health Plans

by Inoventive Solutions

August 18, 2020

While most business owners and executives have been fretting about the COVID-19 pandemic and the effects on the economy and the survival of their business, now is a good time to conduct a review of group health plans in light of changes and new rules for 2021.

Here are some of the main changes that you should consider ahead of the new year:

Out-of-pocket limits – The out-of-pocket limit amounts for 2021 are:

$8,550 for self-only coverage.
$17,100 for family coverage.

For HSA-compatible high-deductible health plans, the out-of-pocket limits for HDHPs with attached health savings accounts for 2021 are:

$$7,000 for self-only coverage
$14,000 for family coverage.

New preventative care recommendations

ACA-compliant health plans are required to cover preventative care services with no out-of-pocket costs, and new ones that become effective in 2020 and 2021 include:

Perinatal depression prevention.
HIV prevention pill for healthy people at risk.
Updated recommendation for prevention of BRCA 1 and 2-related cancer.
Updated recommendation for breast cancer: medication use to reduce risk.
Updated recommendation for hepatitis screening.
Updated recommendation for screening for unhealthy drug use in adults.

Flexible spending accounts

This year, the IRS issued a notice that increased the maximum allowable amount of unused funds at year end in FSAs that can be carried over to the next year.

The notice increases the maximum $500 carryover amount for 2020 or later years to an amount equal to 20% of the maximum health FSA salary reduction contribution for that plan year. That means the health FSA maximum carryover from a plan year starting in calendar year 2020 to a new plan year starting in calendar year 2021 is $550.

Additionally, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) allows employers to remove restrictions that funds in FSAs, health reimbursement accounts and HSAs cannot be used for over-the-counter medications. This is not a requirement that employers relax this rule for their FSA plans, but it allows them to choose to do so.

Summary of benefits and coverage

There are new Summary of Benefits and Coverage (SBC) materials and supporting documents that must be used for all plans that incept on or after Jan. 1, 2021.

Please remember that any changes to benefits in your group plan must be reflected in the SBC plan document and summary plan description.

The takeaway

2021 is fast approaching and with all the chaos of 2020, it would be wise to get a head start on understanding changes in store for the plans you offer. This would benefit both you and your employees.

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Insurers Don’t Have to Pay for Testing Returning Workers: HHS

by Inoventive Solutions

August 12, 2020

New guidance from the Trump administration absolves insurers of the responsibility of paying for COVID-19 tests that are required for workers who are returning to the job.

The guidance, released by the departments of Health and Human Services, Labor and Treasury, means that employers will likely either have to foot the bill themselves as they screen workers during the pandemic or pass those costs on to their workers. But in states that require employers to test workers, passing testing costs on to staff is usually not an option.

There had been some confusion about who would pay for the tests after the Families First Coronavirus Response Act required insurers to cover COVID-19 tests without patient cost-sharing. The new guidance has added a new caveat to that rule: that insurers cannot require health plan enrollees to pay for the test if it is deemed “medically appropriate” by a health care provider.

“Testing conducted to screen for general workplace health and safety (such as employee “return to work” programs), for public health surveillance for SARS-CoV-2, or for any other purpose not primarily intended for individualized diagnosis or treatment of COVID-19 or another health condition, is beyond the scope of section 6001 of the [Families First Coronavirus Response Act],” the guidance states.

Resistance from advocacy groups

The guidance was met with resistance from employer and consumer groups, with the advocacy group Families USA arguing that the nation’s workers should not be saddled with additional costs during these economically uncertain times.

Employers can require employees to be tested before returning to work, but the Pacific Business Group on Health said it would be highly unusual for a large employer to require testing for employees without paying for the tests in full.

Democrats have asked the administration to withdraw the guidance, but the White House has said it won’t and that it would like to see Congress come up with a solution in its next economic stimulus package for the coronavirus pandemic.

The HHS has said that states should use the $10.25 billion that lawmakers appropriated for testing to help pay for tests of returning workers.

Insurance companies may opt to pay for such tests anyway, as a precautionary measure. America’s Health Insurance Plans, however, is calling on more government support to cover the costs, which it says could be between $6 billion and $25 billion annually.

Helping Your Older Workers Transition to Medicare